Equities, taking the first steps

Most investors start with a regular savings account, building their nest egg slowly with relatively low risk. However, once established, your money could work harder for you if at least some were invested in the stock market.

Long-term, the stock market has traditionally offered greater potential for growth. You buy shares in a company and, if it does well, your capital grows, potentially more quickly than a savings account. The problem is, if the company does badly, your capital could go down, and it is this risk which deters many from taking the plunge.

There are, however, a number of ways to minimise these risks. First, the stock market should only be considered as a long-term investment - usually five years plus. Also, rather than buying just one or two companies, consider a pooled investment, where your money is combined with that of many other investors. The advantage here is that a smaller amount of money can get you access to a much wider selection of companies.

The choice of such funds is very wide. Some simply track a stock market index while others employ a professional fund manager to take active decisions over companies. Some target income, others growth, and some even specialise in specific regions or sectors. You do not have to put all your nest egg in one basket.

If you require any further information about the services that we provide or would like to review your financial planning position, please contact us

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