It’s time to talk investing! Risk sounds like a scary concept but not understanding risk and investment timeframes can mean your investments earn a lot less. Taking the time to understand the concept is so beneficial for you. Simply, the longer your investment timeframe the more risk you may be willing to take with your investments as you may be more comfortable with the ups and downs in the value of your investment due to market movements. Equally, the shorter your investment timeframe, the less risk you may be comfortable taking.
Your investment timeframe is how long you want to invest for. Sorted have split investment timeframes into the below categories:
- Short term – 1 to 3 years, for example saving for an overseas holiday or wedding next year.
- Medium term – 4 to 9 years, for example saving for a house deposit in 6 years’ time.
- Long term – over 10 years, for example saving for retirement.
In investing terms, ‘risk’ can be thought of as a chance your investments actual gains differ from the expected outcome or return. This could mean making a lower return than you expected, no return at all, or even losing the money you invested. Generally, the higher the risk the higher the potential returns – and the lower the risk, the lower the potential returns.
Some people like low-risk investments, some people are comfortable with higher risk investments, but it’s essential to know that risk can change. The higher the risk you take, the higher the potential returns you could receive, but the more chance you have of your investments fluctuating in value.
A good place to start is to check your attitude toward risk, that way you can base your investment decisions on an appropriate level of risk for your situation. Sorted have an interactive investment profile quiz, take it HERE – Investor profiler » Sorted
Whai Rawa also have a Risk Quiz you can take to investigate if your risk profile matches your fund choice. Visit the Risk Quiz and fill out 5 questions at www.whairawa.com/riskquiz
* Te Rūnanga o Ngāi Tahu matched savings and distributions (when applicable) are available to all eligible Whai Rawa members under 65 years of age (see the Product Disclosure Statement) and are subject to RSCT (retirement scheme contribution tax) deducted at your personal RSCT rate (see the Other Material Information document at www.whairawa.com). If you do not notify us of your correct rate, you will be taxed at the default rate of 39%. Ngāi Tahu contributions and distribution payments are made no later than 31 March in the calendar year following qualification. Download our PDS at www.whairawa.com/pds
The information contained in this document is intended for general guidance and information only and is not personalised to you. It does not take into account your particular financial situation or goals.
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Whai Rawa Fund Limited is the issuer of the Whai Rawa Unit Trust. A copy of the Product Disclosure Statement is available at www.whairawa.com/pds. A financial advice disclosure statement is available for Whai Rawa Fund Limited at www.whairawa.com/financial-advice.
