All investments are not equal, and knowing what to invest in, when to invest in it and how much to invest are difficult questions to answer. This section is designed to provide some basic guidelines to help, but we advise you seek financial advice before investing.
Asset classes explained
The most common asset classes are equities, bonds and cash. Equities are shares in companies that are traded on stock markets. Bonds are essentially loans to governments and companies that pay fixed interest rates over a set period. Cash is simply money placed on deposit at banks or in bank securities to earn variable rates of interest.
Collective investment schemes
A popular way to gain access to a wide range of assets is to use an investment fund. This allows investors to pool together their contributions, and to share the costs and benefits of investing. The most common collective investments are investment funds or ‘mutual fund’.
All financial investments involve an element of risk. Therefore, the value of your investment and the income from it will vary and your initial investment amount cannot be guaranteed. Your capital and income is at risk. Investors should be aware that moving out of cash in search of higher returns to meet their long -term goals will involve accepting a higher risk of capital loss.