There has been a lot of uncertainty in the world this year, with political events sending the stock marketing yo-yo-ing and the continued drawing out of Brexit making the markets increasingly nervous. What’s going to happen to investments in 2017 is almost anyone’s guess, and in some quarters appears to be more influenced by psychics rather than solid facts. One woman in America, for instance, is predicting a stock market crash because there have been crashes in and 1987, 1997 and 2007.
What to consider when deciding on investments
You don’t have to have a lot of money to make an investment. A simple savings account with a bank or building society counts as an investment. Other types of investment are:
- Fixed interest securities, which are also known as bonds, in which you invest in a government scheme or a company
- Shares, when you buy a stake in a company
- Property, such as buying a residential or commercial building
- Commodities, such as oil, steel, gold etc
- Foreign currency
- Contract For Difference, which are a kind of financial derivative
- Collectibles, such as art, antiques or even wine
Taking risks
You will always be taking a risk on any investment you make, even if you’re just putting your money into a savings account because the interest rate doesn’t always keep up with inflation.
If you’re investing in the stock market, although the rewards could be high, the risk is that you end up selling at a lower price than you bought them for, giving you poor returns.
How much you invest, how many risks you’re willing to take, and how long you’re willing to wait for a return on your investment is very much up to you. The perceived wisdom is that you never invest more than you can afford to lose, and to spread your investment over a number of companies – diversifying.
Getting the right advice
What you do need to do is talk to a good financial or investment adviser who will find out more about your circumstances and wishes, and then discuss the options to consider. Whoever you choose, make sure they are regulated by the Financial Conduct Authority (and not Mystic Meg!).
If you would like impartial advice on investment and wealth management, contact us to make an appointment with one of our experienced advisers.
