The investment process is a great way to reach your long-term financial objectives and grow your wealth. It can also be done with the assistance of professional advisers, helping to balance the need for principal protection and some growth potential with your financial situation and your comfort with risk.
Investment funds pool your savings as well as the savings of other investors. A fund manager then buys the investments, holds them and then sells them on your behalf. Most funds consist of various assets, which reduces investment risk. Certain funds are more specialized, such as those that concentrate on commodities or property. Multi-asset funds could hold an array of different asset classes, including shares and bonds.
Certain funds are targeted towards a particular region or sector like emerging markets or green investment. There are also funds that have a range of specified investment aims such as focusing on specific growth rates or reducing risk that is unsystematic. Others have a general goal for investing, such as low cost investing.
Your investment period as well as your attitude to risk will determine the kind of unit trusts, OEICs, and investment trusts that you choose. Younger investors may prefer to take on a greater amount of risk, and thus https://highmark-funds.com/2021/12/23/value-at-risk-calculations-for-market-risk-management/ choose funds that have a higher proportion of stocks. Alternatively, those approaching retirement or with family commitments might prefer to take a lower level of risk and select a fund with more bonds.