- Want to buy Taylor Wimpey shares for exposure to the construction sector?
- Understand the different trading options before you invest.
- Find out the best way to buy and keep track of what is happening.
Taylor Woodrow and George Wimpey combined in 2007, forming Taylor Wimpey (LON: TW). Both companies had been constructing homes in the United Kingdom since the 1920s.
When the two rivals merged, they produced one of the largest home construction companies in the United Kingdom.
Read on for our complete step-by-step guide to investing in Taylor Wimpey shares.
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Step 1: Sign up with a share broker
Taylor Wimpey is listed on the London Stock Exchange, which your broker must have access to.
There are several factors to consider when choosing what broker to use. Consider the markets they have access to (LSE, NYSE, etc.) and what you can trade on the platform (shares, forex, commodities, indices, etc.). Many brokers do not charge a commission on trades, but some still do.
Although it’s often overlooked, check the broker’s foreign exchange fee. If you plan on buying international shares, the foreign exchange fee can make a substantial difference.
Step 2: Fund your account
You’ll need to have cleared funds in your account before buying shares in Taylor Wimpey. Once you’ve signed up for an account, you can fund it using a bank transfer, debit card, or (sometimes) credit card.
Note that how long it takes for funds to clear depends on the method used to deposit funds.
Step 3: Decide how much to invest
Set an investing budget. Shares fluctuate up and down in value over time. Resist the fear of missing out and investing more than you can afford.
Step 4: Invest in shares or ETFs?
ETFs are a type of diversified investment. Rather than investing in a single company’s shares, investing in an ETF provides exposure to many companies. Some funds are themed such that all the companies in it have something in common. For example, there are ETFs for construction companies, ETFs focused on property, etc.
Although the markets will ultimately determine your portfolio’s value, investing in ETFs can spread the risk because of their diversified nature.
ETFs with exposure to Taylor Wimpey include iShares Core MSCI EAFE ETF (IEFA), Schwab Fundamental International Large Company Index ETF (FNDF), and (SCHF).
Step 5: Configure your order
When you place a market order, your broker will buy shares at the best available price.
Most brokers support orders that can be configured to buy or sell shares at a pre-defined price (stop loss or stop limit orders).
Builders worldwide face similar challenges: high land prices, environmental concerns, labour shortages, rising costs, material shortages, and NIMBYism.
In the UK, where there is a shortage of housing stock, changes to planning regulations could affect Taylor Wimpey in the long-term. Banks tightening or loosening their lending policy can also affect the overall market and Taylor Wimpey.
Monitor Taylor Wimpey’s competitors — Barratt Developments (LON: BDEV), Balfour Beatty (LON: BBY), and Persimmon (LON: PSN) — for announcements since this can inform you of changes in the broader market.
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