All investments carry a level of risk – even cash (especially when inflation is eroding the value of cash savings). Risk does, of course, equal opportunity but any independent financial adviser worth their salt will spend a great deal of time ensuring that their clients are comfortable with the risk level of any investment or pension they hold. This is true both at the start of an investment but also throughout the time an investment is held because investments do change risk levels – both upwards and downwards.

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Risk Descriptions

This guide has been designed to act as a reference example for each of the risk profiles available to you via our Wealthlineinvest Platform. The following five risk profiles and descriptions are current as at August 8th, 2020 (but do change in response to market conditions or as a result of a change to investment strategy).

The Defensive Investor

  • The Defensive investor may be very sensitive to short-term
  • A Defensive investor’s potential aversion to short-term losses could compel them to sell their investment and hold a zero risk investment instead if losses
  • Defensive investors would possibly accept lower long-term return in exchange for smaller and less frequent changes in portfolio
  • Analysing the risk return choices available, a Defensive investor is usually willing to accept a lower return in order to assure the safety of his or her


The Cautious Investor

  • The Cautious investor may be sensitive to short-term
  • A Cautious investor’s potential aversion to losses could compel them to shift into a more stable investment if significant short-term losses
  • Analysing the risk-return choices available, a Cautious investor is usually willing to accept somewhat lower returns in order to assure greater safety of his or her


The Balanced Investor

  • The Balanced investor may be somewhat concerned with short-term losses and may shift to a more stable option in the event of significant
  • The safeties of investment and return are typically of equal importance to the Balanced


The Capital Growth Investor

  • The Capital Growth investor may be willing to accept high risk and chance of loss in order to achieve higher returns on his or her
  • Significant losses over an extended period may prompt the Capital Growth Investor to shift to a less risky


The Aggressive Investor

  • The Aggressive investor usually aims to maximise long-term expected returns rather than to minimise possible short-term
  • An Aggressive investor values high returns relatively more and can tolerate both large and frequent fluctuations through time in portfolio value in exchange for a higher return over the long



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