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Investment Style

Everyone is different in life and this also applies to investors. Everyone will have their own style when building an investment portfolio and it’s important to work out what your own style is since this will have a great influence on what investments you make. What is your overall investment strategy or theory in your asset allocation? Knowing who you are as an investor will help you clarify your investment philosophy and narrow your search down when investing in stocks, making sure that you don’t get confused and over-complicate things with trying to do too much and cover too much ground.

Risk Level

Risk Level


To start with, it’s more to do with using common sense and honesty to work out what kind of investor you’re going to be. Are you a risk taker or not, and, more importantly, what level of risk are you willing to take when building an investment portfolio? It stands to reason that the quicker and bigger returns are often to be made when it’s high risk investments (although this may not always be the case) but this is not for everyone, and novice investors especially should tread carefully.…

Engagement Level

Engagement Level


Do you want to be an active investor or a passive investor? An active investor, usually an investor with experience, will try to time the market and try to outperform the benchmark indexes by investing in stocks they believe are undervalued or short-selling stocks (selling stocks in the belief that their price will drop thus enabling the investor to buy them back at a lower price at a later date and thus make a profit) which they believe are over-valued. A passive investor will try to minimize…

Investment Objective

Investment Objective


What is it that you’re looking for in terms of the type of yield you want, how do you want to judge your investments and your profits, what type of investment portfolio do you want to build? Talk to your broker about this and clarify your position. A running yield is quite simply a calculation that takes the income from your returns (dividends or coupons) and divides it by the market price of that security thus working out its value as a percentage. An investor can then compare investment…

Time Horizon of your Investments

Time Horizon of your Investments


Quite simply, are you looking to make money in the long run or the short term? The time horizon of your investment portfolio is the length of time that the investor expects to hold on to a security and it is entirely up to each investor as to what they are looking for. Quick cash or an investment for the future. For example, if you’re looking to make more money in the long run,investing in stocks represents less risk than cash securities, whereas in the short term, stocks are the more risky…

Risk Level

To start with, it’s more to do with using common sense and honesty to work out what kind of investor you’re going to be. Are you a risk taker or not, and, more importantly, what level of risk are you willing to take when building an investment portfolio? It stands to reason that the quicker and bigger returns are often to be made when it’s high risk investments (although this may not always be the case) but this is not for everyone, and novice investors especially should tread carefully. A risk-averse investor should stay away from high risk shares when investing in stocks and investments and accept the fact that they may lose out on some higher returns, but at the same time know that there is less chance of them losing everything in one crazy throw of the dice.

Engagement Level

Do you want to be an active investor or a passive investor? An active investor, usually an investor with experience, will try to time the market and try to outperform the benchmark indexes by investing in stocks they believe are undervalued or short-selling stocks (selling stocks in the belief that their price will drop thus enabling the investor to buy them back at a lower price at a later date and thus make a profit) which they believe are over-valued. A passive investor will try to minimize the risk and try to match the returns of the benchmark indexes by engaging in buy-and-hold investments and showing more patience while slowly building an investment portfolio. Less risk, sometimes as a reflection of a more limited understanding of the market, normally lower yields, but less stress, less involvement and thus more time for other parts of your life. You need to think carefully about what you want, and remember, there’s no rule that says that you can’t switch up at some point and either slow down or take more risks (always calculated of course).

Investment Objective

What is it that you’re looking for in terms of the type of yield you want, how do you want to judge your investments and your profits, what type of investment portfolio do you want to build? Talk to your broker about this and clarify your position.

A running yield is quite simply a calculation that takes the income from your returns (dividends or coupons) and divides it by the market price of that security thus working out its value as a percentage. An investor can then compare investment portfolio performances over time and determine whether to alter the makeup of their portfolio or not.

An investor may look strictly for income, a fund’s payout, if they’re the type of investor who needs a regular income and who doesn’t need to tap into their principal sum for their everyday living. Most bonds, stocks, CD’s and savings accounts pay out regular incomes, and even mutual funds which buy income-paying stocks or bonds will pass that profit onto the investor. This suits the investors who wants their investments to top up their regular income.

Finally, we have capital appreciation, which, as the name suggests, refers to your security going up in price and being worth more than what you bought it for originally. If the investor, or the fund manager, sells the stock, then you have capital gain, and if they choose to hold on to it, you have capital appreciation which means that the Net Asset Value (NAV) of the fund will increase.

Time Horizon of your Investments

Quite simply, are you looking to make money in the long run or the short term? The time horizon of your investment portfolio is the length of time that the investor expects to hold on to a security and it is entirely up to each investor as to what they are looking for. Quick cash or an investment for the future. For example, if you’re looking to make more money in the long run,investing in stocks represents less risk than cash securities, whereas in the short term, stocks are the more risky proposition since they can be more volatile. Most brokers would probably advise someone who is close to retirement age to investing in stocks less than they would someone younger.

All of the above need to be carefully considered and cross-referenced when trying to clarify your investment position.

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