MY DUMBEST INVESTMENT

Send us your smartest or dimmest investment story. If we publish it, you'll get a free copy of the 'Motley Fool UK Investment Guide'. E- mail to UKColumn @fool.com or snail mail to Motley Fool, 'The Independent on Sunday', 1 Canada Square, London E14 5DL.

Years ago, I did three months of back-breaking work to help pay our crippling mortgage. On the final day, looking through the FT-SE index a company name - Poseidon - jumped out at me. The name stuck and wouldn't go away. The crucial question was: invest in our mortgage or buy the shares? The mortgage won. A few weeks later, Poseidon shares started to rocket and quickly went through the roof. I could have bought two houses with the proceeds of the shares.

BG, Oldham

The Fool responds: Perhaps this wasn't such a dim investment decision, after all. Investing in shares should be a long-term undertaking. There are big gains to be made in short-term speculation, but more often there are big losses. The last thing we should be doing is risking our homes on the back of a gamble.

Maybe another lesson here is not to buy "too much" house simply as an investment. In pure investment terms, property has proved a decent investment over time, but the stock market is better. And when interest rates go up (inconceivable as that seems now), an over-large mortgage rapidly becomes a millstone.

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