The investment process can be a fantastic way to grow your money and achieve long-term financial goals. It is also possible to accomplish this with the assistance of a professional adviser, who can assist you in balancing your financial situation and comfort level with risk, balancing the need for some growth potential and the security of your principal.
With the investment funds, your and other investors’ savings are pooled together. A fund manager then buys the investments, holds them and then sells them on your behalf. Most funds comprise different assets, which lowers the risk of investment. Certain funds are more specific like those that concentrate on property or commodities. There are also multi-asset funds which might hold a mix of different types of assets including bonds and shares.
Certain funds are geared toward particular regions or segments like emerging markets or green investment. Many funds have specific objectives for investment, such as decreasing unsystematic risks or striving to achieve a certain level of growth. Others have a more general investment aim, such as low-cost investing.
The type of unit trusts, OEICs and investment trusts you select will depend on both your investment timeframe and your approach to risk. For example, younger investors are typically more comfortable taking more risk and are likely to choose funds that have an increased proportion of equity. On the other hand, those nearing retirement or have family obligations might want to choose an easier risk and choose a fund with a higher percentage of bonds.
