Investing can provide an excellent way to grow your money and reach long-term financial goals. It can also be done in conjunction with the help of professional advisers, helping to ensure that you have the right amount of primary protection and growth potential against your financial situation and confidence in risk.
With investments, your and the savings of other investors are put together. A fund manager will buy, hold and sell investments on your behalf. Most funds consist of various assets, which reduces investment risk. Some funds are more specialised like ones that focus on property or commodities. There are also multi-asset fund that could contain a mix of different types of assets such as bonds and shares.
Certain funds are targeted towards particular regions or segments for instance, emerging markets or green investment. Many also have a range of specified investment aims for example, such as targeting specific levels of growth or reducing risk that is unsystematic. Others have a common investment goal, such as low cost investing.
The type of unit trusts OEICs and investment trusts you choose will depend on the length of your investment period and your risk tolerance. For instance, younger investors are more likely to accept greater risk and are more likely to choose funds that have an increased proportion of equity. For those who are close to retirement or have family obligations might prefer less risk and select a fund with a higher percentage of bonds.
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