The investment process is a great way to reach your long-term financial objectives and grow your capital. It’s also a strategy that can be done with the help of professional advisors, who can help you keep in mind the need for primary protection and growth potential with your financial situation and confidence in risk.
Investment funds pool your savings as well as those of other investors. A fund manager will buy, hold and sell investments on your behalf. Most funds are made up of a variety of assets, which can help to reduce risk associated with investing. Certain funds are more specialized for instance, like those that concentrate on commodities or property. Multi-asset funds can hold an array of different asset classes, such as bonds and shares.
Certain funds are geared toward specific regions or sectors such as emerging markets or green investment. There are also funds that have a range of investment goals for example, such as targeting specific levels of growth or reducing risk that is not systemically controlled. Others have a general investment goal, such as low cost investing.
Your investment period as well as your attitude to risk will determine the type of unit trusts, OEICs, and investment trusts that you choose. For example, younger investors are more likely to accept risks that are higher and may be more likely to choose funds with a larger proportion of equities. For those who are close to retirement or have obligations to their families may prefer to take an easier risk and pick a fund that has more bonds.