Creating Your Investment Strategy

Creating an investment strategy to fit around your ever-changing needs may seem like a tall order. But by following a few simple rules, it is possible to build a flexible investment strategy that can work for you throughout your life.

Your investment choices

The range of investment products on offer in general can seem incredibly confusing. So it can be surprising to learn that most of these products usually boil down to just three key ingredients; cash, bonds and equities (i.e. shares).

These are known as the three key financial asset classes and are the building blocks of our investment strategy.

Cash, bonds and equities have different characteristics, which mean that – when put together in the right combination – they can create an investment strategy that precisely matches your risk profile, your time horizon and your need for income and/or growth.

The table below summarises the different characteristics of each:

*Unless using fixed-rate cash product.

**If held from issue to maturity – there can be a potential capital gain/loss if a bond is sold for more or less than its issue price.

It should be noted that the value of investments can fall as well as rise. Past performance is not necessarily a guide to future performance.

Your risk profile

Choosing the right level of investment risk is essential to create an investment strategy that you are comfortable with. Your Adviser will take you through a risk profile questionnaire and assess your capacity for loss.  Then, having considered your previous knowledge and experience of investing, will determine your tolerance to investment risk. In order for us to construct and manage your portfolio to meet your objectives and risk tolerance, we segment the growth element into three categories:

Building your strategy

The investment strategy has three investment elements: cash, growth and income. They are designed to meet an investors’ need for accessible cash, a regular income or growth potential. Each element is managed by our Investment Management Team in line with our in-house view.

Using these three elements, your Adviser can create an investment strategy that fits in with your individual needs. The system is designed to deliver sustainable returns that can meet your personal requirements for capital growth and/or income over the longer term.