When investing for growth, it is vital to find the balance between risk and reward. In general terms, the more risk you expose your capital to, the more potential return you can gain – of course, the more risk involved, the more chance you have of losing money as well! This means that it is absolutely vital when investing for growth that you use a professional advisor to assess your personal circumstances and your attitude to risk and to recommend a suitable investment or portfolio of investments for your needs.

One of the most important factors to take into account when making an investment, particularly where you are investing for growth, is timescale. The length of time you intend to commit the funds and whether or not you may need to access the funds in the meantime will play a vital role in influencing the recommendations an advisor will make. For example, even if you consider yourself to be an “adventurous” investor and are willing to take a higher risk profile than normal, there is no point in investing in a higher risk fund if you are likely to need access to the funds in the short term. Funds with a higher risk profile have a tendency to be more volatile and this can mean the value of your holdings can fluctuate significantly. If you need access to your funds at a “low” point, this could be a problem. In this type of situation, an advisor will recommend a fund which has the potential to provide similar returns whilst being less volatile in the meantime. Of course, time and time again it has been proven that an investment in the stock market (considered to be high risk) over the long term outperforms most other types of investment. However, this is a perfect example of the type of investment where, if you are likely to need access to the capital at a time when the markets have fallen, it could cause problems.

As mentioned elsewhere, OMM specialise in recommending low risk-investments. Many of our clients feel that exposing their capital to a high risk investment is not worth the potential returns. Particularly when it is possible to achieve returns of 7%-9% per annum in funds which can be easily understood and do not expose the capital to a great deal of risk.

An OMM advisor will be more than happy to complete a Confidential Client Questionnaire and have a chat with you to assist in assessing exactly what your risk profile is and will provide a written report with our recommendations. Contact us for advice or information.