Investment Advice from Principle First
The services of a good adviser when approaching the complex area of savings and investments is probably not just a prudent, but an essential step. With quality investment advice you can identify investments which not only sit well with your own concept of caution or risk, but which also complement each other to form a balance in your portfolio.
Creating an investment portfolio is crucial to make your money work harder for you. But equally crucial is to check your investments on a regular basis, to factor in and respond to changes in the market, and assess the performance of your investments. What is right for you today may not be the best choice tomorrow, and your investment adviser will keep your portfolio current, perhaps even switching your money to different funds as market conditions and performances change.
The first step is to assess your attitude to risk. Would you feel comfortable if the value of your investments were to fluctuate, up or down, by up to 25% in any one year? This can be a feature of stock market investments, but it is a prospect that might alarm the more conservative investor!
Risk profile at the core of investments advice
At Principle First, we base our investments advice on a sophisticated risk profiling system, which uses four investor types. We listen to our customers concerns and wishes, and match them to the investor type most in tune with their thinking.
The ‘defensive’ investor is comfortable only with a very low level of risk, and wants his money placed where it is most safe and secure. This investor is more comfortable with bank deposit accounts, or investments that come with a guaranteed return.
The ‘cautious’ investor is not totally risk-averse, but still uncomfortable with investments that have large fluctuations in the short term.
The ‘balanced’ investor feels happy to mix low-risk and medium-risk investments in their portfolio, and might well accept a stocks and shares investment, for example, in the hope of a relatively good return in the longer-term – while being aware that the value of these investments may fall as well as rise.
The ‘aggressive’ investor is eager to use risk for the potential of a high return. He understands that short-term fluctuations in his investment value are often opportunities in disguise, and that when values fall, this can be a signal that now is a favourable time to make further investments.
The key: regular contact with your investment adviser
There are many elements at the heart of good investment management. Crucial to all good investing are the concepts of timing, balance and spreading risk as widely as possible, and awareness that investments are a long-term strategy that must be constantly monitored. Investments are not static; they evolve and change and need to be regularly adjusted to changing market conditions. At Principle First, we recommend regular consultations with your investment adviser as an essential way to derive maximum benefit from your investments.
