A Beginner’s Guide to Understanding Investments

Classes of investment

Managing your money wisely is one of the cornerstones of creating long term wealth. In order to do this you need to understand the various ways to invest and the risks and rewards involved.

Here are the main classes of investment, known as asset classes available when looking to invest money.

Cash

Saving your money in a building society or bank is a simple low risk investment. You will receive interest on your investment and you have access to your savings when required. Plus your capital is not at risk unless the bank goes bust.

Fixed Interest Bonds

With this type of investment you invest a lump sum for a set period of time with a set amount of interest paid over that period. You cannot access your money during this period without incurring a penalty, typically a loss of interest.