In determining which investments are best for you, you should consider your 'investment time horizon'. Each asset class has a distinct time horizon, which helps to determine its suitability. For example, if your time horizon is one to two years, you should consider a cash investment, such as a term deposit.
As an investor, you aim to get the highest return at the level of risk you feel comfortable with. You need to consider how tolerant you are of market fluctuations and the probability that your investment returns may not meet expectations. Some investments even lose money.
Ask yourself
- How soon do you want to reach your financial goals?
- How great a fall in the value of your investment funds could you cope with and for how long?
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