Yes. As with all investing, the value of your investments can go up as well as down. We listed the key risks we thought you should be aware of below this FAQ entry.
This is the possibility that you could get back less than you invested. As your investment manager, we or anyone else, cannot remove this risk. Our role is to ensure you are adequately compensated for taking this risk: by keeping your costs low, diversifying your investments so you aren’t affected by a specific company event, and allocating you to an optimal mix of asset classes. This process is known as optimizing your risk-to-return profile.
Why does it matter? Your ability to be a successful investor will be largely driven by your ability to understand this unavoidable risk and to deal with it appropriately. This is where we can help.
Time horizon risk
Early and unforeseen withdrawals could negatively impact your investment returns. Time has a buffering effect on investment risk: the longer you hold an investment, the lower your chances of losing money. Remaining focused on the long-term avoids being penalized by negative short- and medium-term market moves. You should have a minimum of a three-year time horizon.
Why does it matter? This is a key difference with a regular savings account where time isn’t a concern.
The risk of getting a lower return on your investments than average in a good market environment. This comes as a result of investing in lower-risk investment products.
Why does it matter? This is the trade-off between our service and a more traditional investment proposition. Because we start you off with a safer investment product and gradually increase your investment to a riskier product, your average return in a good environment will be dampened.
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