Investor Education
invest in yourself

Investor Education

There are many facets to the world of investing and many choices to make: different asset classes, tax implications, risk and return variables, domestic versus international markets, when to buy and when to sell… the list goes on.
A TRUSTED PARTNER

Your money, your future

Having a trusted partner such as your financial planner to help will enable most people to make some sound choices and put their hard-earned savings into some suitable investments.
Why be an investor at all?
growing your wealth

Why be an investor at all?

Investing, by a simple definition, is a means of accelerating the rate at which we save money and grow a future asset base. One of the most compelling reasons to invest is to provide a future nest egg to draw from, so you don’t have to work the rest of your life. Through investing, you are getting your money to grow at an accelerated rate through the power of compound interest.
INVESTOR EDUCATION

The basics of investing

Viewed from the investor’s standpoint, the investment process can be broken down into three fundamental elements.
The basics of investing

1. Setting goals

Some investments should be viewed as long term and are some suitable in the short term. The first step in your investment strategy is to think about your goals and roughly how long until you want to reach those goals.
The basics of investing

2. Risk and return

When considering your investment it is important to understand that:

  • The value of your investment and its returns will vary over time
  • Assets with higher long-term return potential usually have higher levels of short-term risk
  • Returns are not always guaranteed and you may lose some of your money
  • Past performance and returns are not indicative of future returns or performance

All investors need to decide how much investment risk they’re prepared to tolerate (or that won’t keep them up at night). Your individual circumstances may affect the level of risk that you are willing to take and therefore, the potential of return on your investments. Factors that you and your Financial Planner need to consider include:

  • Your age and investment goals
  • How much time you have (your ‘investment timeframe’)
  • Your other assets
  • How much risk you’re comfortable with (or risk tolerance)

For example, let’s say you’re aged 40 and your goal is to save for your retirement at age 60. If you are comfortable with your investment experiencing some bad years as well as good, you might invest in a riskier but long-term higher-performing asset class such as shares, given that you have 20 years to ride out any volatility.

The basics of investing

3. Choosing the right investments

GENERAL RISK/RETURN EXPECTATIONINVESTMENT TYPE (ASSET CLASS)
Low risk, low returnCash (term deposits, savings accounts)
Medium risk, medium returnBonds and fixed interest
Moderate to high risk and returnProperty
High risk, high returnShares (also called equities or stocks)
Read the latest performance report

Read the latest performance report

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