Saving money to invest in a long-term goal is a satisfying experience. And there are lots of different investment options available and each has the possibility of a return that may beat inflation. However, it is crucial to consider the various types of investments and how they fit with your financial goals overall, particularly your tolerance for risk.

Investments and funds

A fund is a collective investment in which your and other investors’ funds are put together and invested in a variety of assets. This helps spread your risk since you aren’t dependent on the performance of a specific asset type. For example an UK equity fund will be comprised of shares of various British companies.

However, you may also find funds that provide an array of different kinds of assets or specific industries. There is a fund that will suit every investor, no matter what level of experience and investment timeline, or level of risk tolerance.

Bond funds are a well-known choice of investment. They are a mixture of IOUs, or debt, typically from companies or governments. They can be less volatile than stocks. They can be affected by changes in interest rates as well as the credit rating.

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