Saving money to invest in a long-term purpose is a satisfying experience. There are plenty of different options to choose from and each has an opportunity to earn a return that could beat inflation. But it’s important to consider the various kinds of investments and how they align with your financial goals overall and your level of tolerance for risk.
Funds and investments
A fund is a group investment where your and other investors’ funds are put together and placed in a variety assets. This helps spread your risk because you’re not relying on the performance of a single asset type. For example, a UK equity fund would be comprised of shares from different British companies.
You can also find funds that cover a variety of different asset https://highmark-funds.com/2021/12/23/value-at-risk-calculations-for-market-risk-management/ types, or certain sectors that are more specific. There is a fund for any investor, regardless of what their level of expertise or investment timeframe or their risk tolerance.
Bond funds are a popular choice of investment. They are a combination of IOUs or debt, typically issued by government agencies or companies. They are less volatile than stocks. They are impacted by changes in interest rates as well as the credit rating.
