Unravelling the mysterious world of high finance

Reading the markets: Brian Tora returns to start a new series explaining how plan your long-term investment strategies

Well, hello there. I must say it is nice to be back. Remember me? I used to write a column in The Independent on investment and finance.

And now I am back after a gap of - gosh, it must be all of two years - to deliver the same words of wisdom all over again. Well, not the same words exactly. Similar though.

Should you read this column? Of course you should. Investment is most important to you. And investment has been my life. Or two-thirds of it to be exact.

This year I celebrate 34 years in the investment industry. Add to that the 17 years I spent from cradle, through short and long trousers and countless pairs of shoes, to a humble job in the Square Mile, and you do not need an honours degree in mathematics to work out my age.

Having earned my living from investment in the City of London, I can understand that the world in which I live and work is a cornucopia of contradictions.

It is the great success story of British service industries, yet insufficiently understood by the general public. It is where new money meets old. Where brash young Essex traders rub shoulders with the titled and the hyphenated. It is both mysterious and accessible. But above and beyond everything else it is more important to you and your future financial well being than you probably realise.

You see, the reason that the personal finance editor asked me to write this column is that he knows all of you need to be learning more about the principles of investment and how the decisions you make will affect you.

All right, "all" might be a bit of an exaggeration, but I am talking about the majority of the population - a mass of people far more numerous than the 10 million or so shareholders that British companies can presently count on their registers.

This is not fanciful conjecture. This is fact. Many of you might already own shares, but do you really follow them?

Those of you who are not shareholders may be investors indirectly through pension schemes and insurance policies.

What is certain is that more of you need to invest for the future and, even if you are already doing just that, to understand what is going on in the world of high finance.

Of course, it is not really high finance. Telephone numbers might trip off traders' tongues, but in these days of best-execution, cheap-dealing services and a world-wide web of information, no one should feel too out of touch with markets not to be able to take the right basic decision.

And, anyway, you and I are in the investment business for the long-term. Leave the short-term trading opportunities to the professionals, not because they are better at it, but because they need to flaunt their plumage from time to time and grease the palms of the odd broker or two.

I am not against making a quick buck on the Exchange, but if you get the long-term decisions right, you could find that your nest egg sports more swans than ugly ducklings.

Just in case you think this is just another broker pitching for short- term business from the unwary, let me remind you why this is so important.

Governments throughout the developed world are withdrawing from the business of providing adequate retirement provision.

Post-employment income will increasingly be down to you. Expect all but non-essential medical provision, further education and long-term unemployment to follow.

The message is to save when the going is good so you can draw financial comfort when tougher times take over.

And I start from the basic premise that equity investment, properly structured, maintained and managed, provides the best means of building savings into a worthwhile amount over anything other than a relatively short period. It is regrettable that so much of our savings are directed into bank and building society deposits.

Well, if your experience of equities thus far has been to join Sid in applying for British Gas shares, then I can understand your disillusionment.

If you had received Abbey National shares when it floated, on the other hand, you probably think it is too easy.

Learning to pick the Abbey National rather than the British Gas - or this week the Vega Group rather than the Dixons, will be what this column is all about. On the way I expect to light upon government securities, PEPs, Tessas, unit trusts and even Oeics. They really are an investment vehicle, not the cry of a trader anticipating a Labour government.

"A Labour government!" I hear you say. "Surely that is bad for investors?" Well, it just might be. Or there again it could be an opportunity. You will just have to read this column to find out.

Brian Tora is chairman of the investment strategy committee of Greig Middleton, a firm of stockbrokers.