Investing – What You Need to Know
Investment is a great strategy to achieve your long-term financial goals and also grow your money. It can also be done with the assistance of expert advisers, who help you to make sure you are balancing the need for primary protection and growth potential with your financial circumstances and comfort with the risk.
With investments, your and other investors’ savings are put together. A fund manager buys, holds and sells investments on your behalf. The majority of funds are comprised of a mix of assets, which can help to reduce risk associated with investing. However, some funds are more specific than others, such as funds that concentrate on commodities or property. There are also multi-asset funds that may hold a mixture of different types of assets, including shares and bonds.
Certain funds are focused on particular regions or segments like emerging markets or green investment. There are also funds that have a range of investment goals, for instance, targeting certain levels of growth or reducing risk that is unsystematic. Others have a general investment goal like low cost investing.
The type of unit trusts, OEICs and investment trusts you pick will depend on both your investment timeframe and your approach to risk. Younger investors might prefer to take on a higher level of risk, and thus choose funds that contain a higher percentage of stocks. However, those who are approaching retirement or with family commitments might prefer to take a lower level of risk and select a fund with more bonds.