KEVIN Simpson of financial advisors Blue Trust answers some commonly asked financial questions.
Q I am looking for a low risk investment for growth, could you please list a few options for consideration
A The areas that match your attitude to investment risk are, Deposit Accounts, Gilts, Guaranteed Funds, some Structured products, and possibly Premium Bonds. Risk and reward are inextricably linked and as such lower risk investments normally do not get a great return but also do not suffer from the risk of some of your capital being lost in most cases
Q I have heard the term Investment pyramid, What is this
A This is a Portfolio strategy that allocates assets according to the safety and soundness of the investments. At the bottom of the Pyramid are lower risk investments, the mid portion has some growth investments and the top portion include speculative investments. The percentage amounts in each area should match your attitude to risk for the whole portfolio.
Q I have heard some of my colleagues talk about Nest. What is it?
A You may have seen some of the advertisements for this recently on the TV, the term refers to the National Employee Savings Trust. Basically very soon all firms which aren’t exempt will have to offer staff a company pension scheme. It is aimed at increasing the levels of saving in the UK by requiring both employers and employees to contribute to a pension.