Picking individual stocks can be challenging, especially for beginners with limited funds who might find the process overwhelming. However, several accessible methods are available to simplify the process of choosing the best stocks for beginners with little money.
This guide highlights some of the top UK stocks suitable for beginners and, importantly, outlines key factors and potential pitfalls to be aware of when selecting shares. Beginners should understand a company’s business, evaluate its financial stability, and be mindful of the risks, such as potential losses and market volatility.
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The best UK stocks for beginners with little money – A quick look
With thousands of stocks to choose from, it’s important for beginners to start with stocks that they understand, offer growth potential, and align with their financial goals. Following are our picks of the best UK stocks for beginners with limited funds:
- AstraZeneca: Based in Cambridge, the UK’s largest drugmaker has a large portfolio of therapies for oncology, inflammation, neurological, cardiovascular and gastrointestinal conditions.
- Marks & Spencer: Britain’s fastest-growing supermarket and department store with more than 1,000 stores in the UK and around 430 other locations worldwide. It grapples with the impact of a recent cyberattack.
- Admiral Group: The financial services group, based in Cardiff, Wales, is the leading motor insurance carrier in the UK. It also delivers household, travel and pet insurance, as well as personal lending products.
- Unilever: A fast-moving consumer goods company with around 400 well-known food, personal care, and home care brands, including Hellmann’s, Knorr, Carte D’Or, Magnum, Domestos, Dove and Lynx.
- Tesco: The UK’s largest grocer with a consistent share of about 28% percent of the market. It also offers mobile phone and insurance services. Outside the UK, it has presence in Ireland and central Europe.
- GSK: The London-based pharmaceutical giant, formerly known as GlaxoSmithKline, has a huge pipeline of therapies for respiratory diseases, cancers and infections. It’s coming off a promising first-quarter.
- British American Tobacco: The world’s second-largest tobacco company is a value stock that has increased its dividend for 27 consecutive years. It’s shifting from cigarettes to smokeless nicotine products.
- Diageo: One of the largest alcohol companies in the world with more than 200 brands, including Johnnie Walker, Guinness, Baileys and Smirnoff, has sales in nearly 180 countries. Its net income rose 39% in Q1.
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The best UK stocks for beginners with little money: A closer look
Now that you know what we’ve selected as the best UK stocks for beginners with little money, let’s understand what makes them particularly suitable for beginners:
1. AstraZeneca (AZN): Portfolio paying off with increased revenue
Overview
AstraZeneca is the largest company on the London Stock Exchange (LSE) by market value and continues to show growth, particularly from its stable of oncology therapies. Its strong success rate among Phase 3 trial candidates has led to 31 new approved therapies since the start of the year.
Why AstraZeneca is one of the best UK stocks for beginners with little money
AstraZeneca trades at just more than £10.40 per share and is up more than 37% so far this year. The company has had momentum from new therapies with 16 positive key Phase III trial readouts so far this year.
The company is looking to dodge tariff issues with the US because it has pledged $50 billion of development there, including the largest manufacturing investment in the company’s history in Virginia. As the US is its No.1 market, with a 40% share of its sales, the site is key to meeting its long-term goal of generating $80 billion in annual revenue by the end of the decade.
For the first nine months of the year, AstraZeneca posted revenue of $43.24 billion, an increase of 11% year over year at constant exchange rate, driven by improved sales in its oncology and biopharmaceutical therapies. Core earnings per share (EPS), which is adjusted for some items, rose 15% at constant exchange rate to $7.04.
The drugmaker reiterated its full-year earnings forecasts. It continues to expect full-year revenue to climb in the high single-digits this year, with core EPS rising at a low double-digit percentage.
Don’t overlook the company’s dividend, which draws a yield of about 4.53%. AstraZeneca boosted its interim dividend by 3% this year to 76.7 pence.
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2. Marks & Spencer (MKS): Getting back on track after a costly cyberattack
Overview
Marks & Spencer Group, also known as M&S, operates various retail stores that provide deli and dairy products, an in-store bakery, general groceries, womenswear, menswear, childrenswear, home products, and financial services.
Why Marks & Spencer is one of the best UK stocks for beginners with little money
Marks & Spencer stock appears to be a bargain with its shares down 1% so far this year, even as the company continues its comeback from a cyberattack this past spring that left some shelves empty in the immediate aftermath and halted its online sales for months.
M&S earlier estimated that it would have a £300 million hit to operating profit this fiscal year. The company had said it aims to reduce the figure through cost management and insurance payouts. It has already received a £100 million payout from insurers related to the attack.
The retailer is implementing a turnaround plan that began in October 2022 under Stuart Michin, who became chief executive earlier that year and the recovery is well underway.
While results for the fiscal first half ending 27 September, showed the negative impact of the hacking incident, it also displayed the company’s resilience.
Even as statutory profit before tax declined 99% from a year earlier to just £3.4 million, profit before tax and adjusting items fell to a lesser extent, by 55% from the same year-earlier period to £184.1 million. Adjusted EPS shrank to 6.6 pence from 14.7 pence.
Revenue rose 22.5% to £7.94 billion. Food sales climbed 7.8% to £4.53 billion. Fashion, Home & Beauty sales, which were most affected by the hack, declined 16.4% to £1.7 billion.
Being a consumer company, Marks & Spencer has faced economic challenges in recent years, including inflation and low consumer confidence. Still, it has been successful in making changes to push its growth forward, including boosting its in-store and online presence.
The success of Marks & Spencer’s turnaround strategies is evident from the investor confidence it enjoys and the fact that it’s now Britain’s fastest-growing supermarket.
Worldpanel (formerly Kantar) data reveals that a third of UK households are now buying groceries at M&S following the introduction of value ranges for everyday shoppers.
The supermarket’s grocery market share was 4.5% for the year to 7 September, with 4% in its shops and 0.5% via its partnership with online-only supermarket Ocado. The figures put M&S on track to reach the target set by its CEO of achieving a 4.5% grocery market share through its stores by 2028.
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3. Admiral Group (ADM): Strong growth, great brand presence
Overview
Admiral (LSE:ADM) enjoys strong brand recognition as the leading car insurance company in the UK and markets the Admiral, Bell, Elephant, Diamond and Veygo insurance brands, in addition to price comparison services Confused.com and Compare.com. It has more than 11.1 million customers across the countries of the UK, France, Italy, Spain and the US.
Why Admiral is one of the best UK stocks for beginners with little money
The insurer has only been around for a little more than 30 years, but it’s as stable as it gets. Plus, it’s trading at around £32 per share, less than 12 times earnings, below average among industry peers, representing good value for the shares.
In the first half of the year, it had a record profit of £521 million, rising 69% year over year, lifted by its motor insurance arm. EPS rose to 132.5 pence from 76.9 pence a year earlier.
The insurer added 1 million customers compared with the same period a year earlier, to 11.42 million, thanks to competitive pricing.
It’s use of AI to drive efficiency, partnering with Google Cloud, to produce more personalised products and services for customers.
The company’s twice-yearly dividend yields 5.46%. It will pay an interim dividend of 115.0 pence per share, compared with 71 pence per share a year earlier. The stock has risen by more than 21% so far this year.
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4. Unilever (ULVR): A staple brand with more growth to come
Overview
Unilever is a fast-moving consumer goods company that operates through several segments, including Personal Care, Home Care, Beauty & Wellbeing, Nutrition, and Ice Cream.
Why Unilever is one of the best UK stocks for beginners with little money
Unilever stock has been broadly unchanged this year, partly due to lacklustre earnings.
In the first six months of fiscal 2025, EPS fell 3.7% year over year to €1.42, and revenue dropped 3.2% to €30.1 billion. There’s still cause for optimism for this multi-brand company because it’s expected to have little impact from tariffs.
In the first half, underlying sales grew 3.4%, and for the full year it expects underlying sales to rise between 3% and 5%, thanks to continued strength in developed markets and improved sales in India, Indonesia and China.
It also has a quarterly dividend that yields around 3.4% after an increase of 3% this year.
Unilever has transcended the status of most companies, with its products having become a necessity for many consumers. The company, which owns several brands, including Knorr soups and sauces, Hellmann’s mayonnaise, Axe, Dove, and more, has shown top-line performance despite global macroeconomic uncertainty.
Unilever’s strategy of increased brand investment and scaling fewer, bigger innovations is paying off well. Though the company is struggling in some markets, such as Indonesia and China, it’s making strides in other key emerging markets.
In addition to strengthening its brand, the company is also focusing on controlling its cost, and this has helped boost its gross margin lately. All such strategies put the company on the right growth track for the foreseeable future.
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5. Tesco (TSCO): UK grocer set to outperform growth expectations
Overview
Tesco is the largest grocery retailer in the UK that also operates in the Slovakia, Hungary, Republic of Ireland, and the Czech Republic. The company offers its products offline and online and also deals in food and drink wholesaling activities.
Why Tesco is one of the best UK stocks for beginners with little money
Tesco is an industry leader and a go-to store for 51% of online grocery orders in the UK. Its shares are up about 10% this year and around 42% over the past five years. The stock trades for less than 21 times earnings, which is slightly higher than the consumer staples industry average of about 11 times.
In the first half, the company reported revenue of £33.5 billion, up 5.1% year over year. EPS, adjusted for non-recurring items, rose 6.8% to 15.43 pence.
One cloud is the retailer said it expects full-year adjusted operating profit of between £2.7 billion and £3 billion, down from £3.13 billion in 2024/25.
The company’s revenue growth comes despite rising interest rates pushing consumers toward low-cost chains such as Aldi and Lidl. Tesco has kept up by adding more than 350 new products in the quarter, including its new Finest Regional Italian range and enhancements to its Fire Pit barbecue range.
Tesco has shown excellent stability and resilience despite rising competition and economic uncertainty, making it an excellent stock for beginners to consider. According to Kantar data, its market share is around 28%, well ahead of the UK’s second most popular grocer, Sainsbury’s.
Tesco also rewards investors with a dividend that yields around 3% after a 12.8% increase to the interim dividend to 4.80 pence per share.
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6. GSK: Pharma giant is a well-priced, stable earner
Overview
The company is the second-largest pharma company in Great Britain, based on market cap. It’s making up for falling vaccine sales with increased revenue from its cancer and respiratory therapies.
Why GSK is one of the best UK stocks for beginners with little money
The well-established pharmaceutical company is trading at less than £14.05, and after rising almost 3% this year, is trading for around 17 times earnings, slightly below average among its peers. This is in spite of the fact that the company said it expects sales to increase by 3% to 5% in 2025 with core earnings rising 6% to 8%.
In the second quarter, GSK posted revenue of £7.9 billion, up 1% year over year, with core EPS of 46.5 pence, which rose 7%.
The growth drivers include specialty medicines sales of £3.3 billion, up 15% year over year, and oncology sales of £500 million, up 42%.
Another bonus for beginners is GSK has a quarterly dividend of 16 pence that yields around 4.5%. That makes it easier to stick around for the company’s burgeoning pipeline.
The company said it has five major new product approvals expected in 2025 and a total of 14 therapies worth 2 billion a year between now and 2031.
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7. British American Tobacco (BATS): High-priced stock with potential growth opportunity
Overview
British American Tobacco offers tobacco and nicotine products worldwide through several popular brands, including Vuse, glo, Velo, Grizzly, Kodiak, Dunhill, Kent, Natural American Spirit and more.
British American Tobacco is one of the largest tobacco companies in the world. Though its share price is on the higher side (around £42.86) for beginners with little money, it’s still on our list of best stocks for beginners because of its potential growth. Its shares are up a little more than 45% so far this year.
Why British American Tobacco is one of the best UK stocks for beginners with little money
With declining global cigarette consumption continuing to be a setback for the world’s second-largest tobacco company, the company is making efforts to offset this decline by investing in next-gen nicotine-related products that pose lower risk.
In the first half, revenue from its smokeless products was responsible for 18.2% of overall revenue, up 18 bps.
The company had first-half adjusted EPS of 162 pence, down 0.1%, but up 1.7% when the Canadian business is excluded where there’s a adjusted for some items and the Canadian business due to a requirement to use profits to settle a litigation liability. Revenue fell by 2.2% to £12.1 billion, due to currency headwinds.
The company has been able to raise prices, but it is struggling in some markets as buyers are shifting from expensive cigarette brands to cheaper alternatives
Another thing that makes BATS popular among investors is its attractive dividend yield of around 5.58%, which is more than four times the average yield of companies in the S&P 500 index (around 1.25%) and of average consumer-staples stocks.
Though the tobacco firm is raising the prices of its products to offset the decline in volume, we believe its high dividend yield is what makes investors stick to the stock.
If the company is able to sustain the yield and revenue, it could become the top choice of investors for many years to come. It also is on track to deliver £1.1 billion in share buybacks this year.
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8. Diageo (DGE): A steal at its current price
Overview
Diageo is one of the largest alcohol companies in the world and operates in 132 countries worldwide. The company owns some of the most popular brands in the segment, including Johnnie Walker, Guinness, and Smirnoff.
Why Diageo is one of the best UK stocks for beginners with little money
Diageo’s stock is down more than 19% this year and more than 20% over the past five years, but we still believe it’s one of the best shares for beginners.
Inflation is eroding into its sales, which were flat at at $20.2 billion, according to its preliminary numbers for fiscal 2025 that ended 30 June. Operating profit, meanwhile, fell 27.8% to $4.3 billion, due to exceptional impairment and restructuring costs and currency fluctuations.
The company is also dealing with the departure of CEO Debra Crew, who was at the helm for only two years.
Financial challenges pushed many consumers away from the higher-end brands, including Diageo, towards cheaper alternatives. Though this trend remains a threat, the company seems to be slowly recovering from this.
One star is its Guinness brand, which has delivered growth despite consistent price hikes. The company, is dealing with the financial conditions better than some of its peers and its market share increased to 65%.
The stock is attractive because it is trading at less than 18 times earnings, favourable compared to most of its peers. With premium brands under its umbrella, the company promises stable growth in the long term, despite tariff concerns. In the meantime, patient investors can enjoy its dividend, which yields roughly 3.69%.
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Stocks and shares refer to units of ownership in publicly listed companies. The owners of stocks and shares are called shareholders, who get voting rights and dividends. Though the term shares and stocks are used interchangeably, there is a technical difference between them.
The term stock usually refers to the portions of ownership in one or more companies. For example, Mr. A owns stock in Apple and Amazon.
Shares, on the other hand, refer to a person’s ownership percentage in a particular company. For example, Mr. A owns 40 Apple shares.
How to invest in UK stocks for beginners
Knowing the best stocks for beginners with little money isn’t enough to start investing. Investors need to consider a few more things to help them invest efficiently in UK stocks.
1. Set achievable financial goals: Having a financial goal is very important. It helps you to focus your investment efforts to achieve those objectives.
2.Select a broker: It is always recommended that you invest in a stock market through a registered broker or a robo-advisor. When selecting a broker or a robo-advisor, selecting a reputed service provider with 24/7 customer support is important.
3. Pick a type of investment account: Whether you are investing through a broker or robo-advisor, you need an investment account. There are several types of investment accounts to choose from, such as a Roth IRA, which offers tax benefits.
4. Set a budget: A new investor always faces this tough question – how much money should I invest in stocks? Thus, you must set a budget beforehand and stick to it.
5. Test with virtual funds: Before you put your hard-earned money at risk, it is recommended that you test your investment strategy with fake money. Several brokers allow users to test their trading skills with virtual money.
Types of stocks to look out for as a beginner
If you are just starting in the stock market, there are a few categories that are well-suited for beginners. Though not all stocks in these areas are good buys, they can serve as a great start in your search for returns.
Dividend stocks
Dividend stocks are shares of companies that offer regular dividends to their shareholders. These stocks provide steady income and potential capital appreciation and are thus appealing to beginners.
Blue chip stocks
Blue-chip stocks are the shares of well-established companies that have stable earnings. Such stocks are usually safe bets as these companies are typically leaders in their respective industries. Moreover, such stocks are reliable and are less volatile than the shares of smaller, less established companies.
Growth stocks
Growth stocks are the shares of companies that are expected to grow at an above-average rate compared to other companies in the same category. Though growth stocks can be more volatile than blue-chip stocks, they offer significant capital appreciation opportunities.
Type of stocks to avoid for beginners
Some share categories may include cheap stocks or ones promising fast price appreciation that beginners would be well advised to avoid due to their risky nature. The following types are best suited for experienced investors with higher tolerance for risk:
Penny stocks
Penny stocks are low-priced stocks with lower market capitalizations. Beginners with a small amount of money can buy a good quantity of penny stocks. These stocks can offer attractive returns even with little appreciation in their value.
Often, though, they are cheap for a reason and these companies are new and untested, have limited trading volume, or lack substantial financial history or information. Therefore, they are highly speculative in nature.
Meme stocks
Meme stocks are the shares that have gained widespread popularity among retail investors because of social media hype. Similarly to penny stocks, they are highly speculative investments and may be too risky for beginners.
The performance of these stocks is primarily influenced by social media and is not backed by their fundamentals. These stocks usually gain popularity among new investors, resulting in short-term gain in their price.
An ISA or Individual Savings Account is a tax-free way to grow your savings, as the interest you earn from this account is not taxable. It is a good way for beginners to save some money while growing their investments. Some of the best stocks and shares ISAs for beginners are:
AJ Bell
AJ Bell stocks and shares ISA allow investors to invest with as little as £25 a month, or invest a lump sum. Investors are free to choose their own investment, or select from AJ Bell’s ready-made portfolios. They also have a mobile app to help investors track their investments.
Vanguard
Vanguard stocks and shares ISA is easy to open and the fees are low as well. Investors can either select their own funds or funds to invest in or choose from Vanguard’s Managed ISA. Additionally, investors get 24/7 access to their funds and help from a UK-based customer service team and more importantly, there are no hidden charges.
Hargreaves Lansdown
Hargreaves Lansdown ISA allows investors to check their investments with its app or website easily. Here also investors can pick their investment or choose from the platform’s ready-made portfolios. Investors can select from over 3,000 funds and can invest as little as £25 a month (or £100 lump sum).
Nutmeg
Nutmeg offers low-cost options compared to other managed investment funds. It is a good option for passive investing and for investors with little knowledge about the workings of the stock market. Nutmeg’s investment portfolios are well-researched and are looked after by prominent investing experts
How We Rate Stocks
We review each stock that is selected. Below are the key metrics we check before listing stocks on the website. For further details, you can also take a look at our stocks rating guide, featured on ValueWalk.
Balance sheet
Potential Growth
Competitiveness
Liquidity
FP Markets, a globally recognized CFD multi-asset brokerage, stands out as one of the best places to buy UK stocks in 2025. Offering access to CFD trading on a wide range of financial instruments, FP Markets enables traders to invest in nearly 1,000 London-listed stock CFDs, making it a top choice for those looking to trade UK shares efficiently.
FP Markets provides traders with access to some of the UK’s most well-known companies, including HSBC, Lloyds Banking Group, Vodafone, Barclays, EasyJet, and Tesco. These stocks span multiple industries, allowing investors to diversify their portfolios and take advantage of market movements.
One of the key advantages of trading UK stock CFDs on FP Markets is its competitive commission-based pricing model. The platform charges a transaction fee of 0.10% of the trade value, with a minimum commission of £10 per transaction. This transparent pricing ensures traders can manage their costs effectively while benefiting from FP Markets’ tight spreads and deep liquidity.
Beyond trading, FP Markets supports its users with extensive educational resources, including webinars, market insights, and trading articles, helping traders make informed decisions. Additionally, the platform offers convenient funding options with no deposit fees, accepting PayPal, Skrill, Neteller, and bank transfers, making it an accessible and cost-effective choice for UK stock trading in 2025.
Conclusion
The stocks discussed above may be a great place to start your investing journey and build your portfolio.
However, it’s important to remember that good investing is not always about buying the best stocks. Sometimes, good investing also means avoiding stocks that can compromise your entire portfolio.
Additionally, finding the best hydrogen stocks in the UK – or any investment – requires figuring out the right approach for you, choosing the platform that works best, and understanding your own risk tolerance.
FAQs
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References
AstraZeneca first-half earnings
Marks & Spencer full-year report
Admiral Group 2024 full-year report
