Investing can provide an excellent way to grow your money and meet your long-term financial goals. It is also possible to achieve this with the assistance of a professional advisor, who can help you manage your financial situation and comfort level with risk, balancing the need for growth potential and the protection of your principal.
With investment funds, your as well as other investors’ savings are put together. A fund manager buys securities, holds them, and sells them on your behalf. Most funds are made up of a variety of assets, which can help to reduce risk associated with investing. However, some are more focused than others, such as funds that are focused on property or commodities. There are also multi-asset fund that could contain a mix of different types of assets, including shares and bonds.
Certain funds are geared towards certain regions or sectors like emerging markets or green investments. Many also have a range of investment goals for instance, aiming at specific levels of growth or reducing risk that is not systemically controlled. Others read more have a more general investment goal, like low-cost investing.
Your investment duration as well as your attitude to risk will determine the kind of unit trusts, OEICs, and investment trusts you select. For instance, younger investors are typically more comfortable taking risks that are higher and may be more likely to choose funds with a larger proportion of equities. Alternatively, those who are nearing retirement or have obligations to their families may choose to take the risk at a lower level and select a portfolio that has more bonds.