It is a great method to meet your long-term financial goals and also grow your savings. It is also possible to accomplish this with the assistance of an experienced adviser, who can help you to balance your financial situation and level of comfort with risk against the need to increase your potential growth and the security of your principal.
Investment funds pool your savings as well as the savings of other investors. A fund manager will then buy, hold and sell investments on your behalf. The majority of funds consist of a variety of assets, which can help reduce investment risks. However, some are more specific than others, such as funds that concentrate on commodities or property. Multi-asset funds may hold various asset classes, including shares and bonds.
Certain funds are geared towards specific regions or segments like green investments or emerging markets. Many funds have objectives for investment, such as decreasing unsystematic risks or striving for a certain level of growth. Others have a broad investment objective, such as low cost investing.
The type of unit trusts OEICs and investment trusts you pick will depend on the length of your investment period and your risk tolerance. For example, younger investors are more likely to accept a higher level of risk and may be more inclined to choose funds that have an increased proportion of equity. Alternatively, those approaching retirement or have family commitments may prefer to take less risk and pick an investment with more bonds.
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