Investments can be a great opportunity 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 to balance your financial situation and level of comfort with risk versus the need for growth potential and the security of your principal.
With investment funds, your and the savings of other investors are put together. A fund manager then purchases, holds and sells investments on your behalf. The majority of funds consist of a mix of assets, which helps reduce investment risks. Certain funds are more focused, such as those that concentrate on commodities or property. Multi-asset funds could hold an array of different asset classes, including bonds and shares.
Certain funds are targeted towards a specific region or sector like emerging markets or green investments. Many funds have objectives for investment, such as decreasing unsystematic risks or striving to achieve a certain level of growth. Others have a more general investment focus, such as low-cost investing.
The kind of unit trusts, OEICs and investment trusts you pick will depend on your investment timeframe and your risk tolerance. For instance, younger investors are generally more comfortable taking greater risk and are more likely to choose funds with more equity-based investments. Alternatively, those who are close to retirement or have family obligations may choose to take an easier risk and choose a fund that has more bonds.
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