Our simple 2 stage investor profiles will give you a good place to start
Different types of investments work best in different circumstances, and for different people. Our investor profiles can help you find the right types of investments to suit your needs. And our free investment picker tools will then help you track down the individual shares, Funds or ETFs that fit the bill.
When you've decided that investing in the stock market is the right thing for you, there are lots of investments to pick from. But how do you know which ones are right for you?
Instead of jumping straight to searching for individual investments, it's a good idea to look at the bigger picture, first. Finding the right types of investments, (or the right mix of different of those different types) means looking at some key factors; your approach to risk, your knowledge and experience, and the time you can put aside for your investment(s) once you've made your choice.
Introduction
We've developed an investment model to help you get started. It's based on two dimensions, risk and what we've termed 'inputs' - of which more in stage 2. Based on your approach to these two areas, we'll show you how a mix of shares, funds and ETFs might work for you. Think of it as a good starting point, from which to refine your own plan.
Let's look at the risk dimension first.
Stage 1 - Your risk profile
Here are three kinds of investor. Each one takes a different approach to risk. Consider them all and decide which one best fits your own circumstances. Then click the arrow next to your selected profile to go to Stage 2 and see an investment approach that might suit.
Cautious
"I want to achieve returns that are better than the rate of inflation over the medium to long term (5 or more years).
I understand that in order to get returns that beat those available on cash deposit accounts I need to accept some stock market risk, and recognise that, as a result, my capital won't be as secure. But I would feel uncomfortable about sharp falls in the value of my money, and would prefer to invest in more stable investments rather than see this happen.
Keeping ahead of inflation and getting a slightly better return on my money is more important to me than getting the highest possible return by accepting a higher level of risk."
Moderate
"I want my money to grow over the medium to long-term (5 years or more), so that it has the best chance of comfortably beating inflation and giving me a higher return than I'd get from cash-type deposit accounts.
I believe the capital growth available from investing in the stock market gives me the best chance of achieving this and understand that, in return, I will have a higher level of risk, which would mean that my capital won't be as secure. I would not be happy with a significant fall in the value of my money in the short-term but this would not be a problem for me as I am investing for the longer-term. However, if the falls were sustained over a longer period, I would become more concerned and might consider moving some of my money to less-risky investments."
Adventurous
"I want to see real growth in my capital in the short-to medium term (3 - 5 years), and am not worried about short-term fluctuations or losses.
To achieve this I am prepared to invest in a wide range of stock market investments, including those of a more volatile nature where the ups and downs can be wider, and where the risk of losing my money is higher.
I would expect to off-set some of this higher-risk by having other lower-risk investments. Although I wouldn't be happy about it, the money I am looking to invest now is money I could afford to lose."
Of course, the risk/reward equation is never as simple as this: there are shades of grey. So, as an account customer of The Share Centre, you can call our in-house experts to discuss your own circumstances, aims and objectives in detail, and to develop an investment plan tailored to you.