When it comes to getting started in investing, for many people the thought of high-risk funds holds little appeal. While there can be big winners, those who lose are plentiful. That is why it is worth considering alternatives by looking at investment opportunities that are low risk.
If you are wondering when is the best time to invest, the truth is that is down to your circumstances. It is not about waiting for the market to bottom out or recover as nobody knows when these events will occur. Here’s a look at some great low-risk options to consider.
High-Yield Savings Account
Looking at the likes of Federal Deposit Insurance Corporation (FDIC) accounts provide a great option for those seeking low risk. These accounts are highly liquid and, reassuringly, they see little impact from market fluctuations.
The drawback is that the returns are relatively modest with interest rates being low. However, lower returns are often the trade-off for this lower risk.
Gold has always been viewed as a safe haven for investors. Whenever markets see a downward trend, investors pump funds into gold. Why? Because it is expected to hold value over the long term.
While the past can never be a guarantee for future performance where gold is concerned its value has increased by 500% over the last 30 years.
These see investments made into companies. Companies then pay a set amount of interest for an agreed time. This interest can be fixed or variable. At the end of this time, when the bond matures, the investor gets their original sum back.
Corporate bonds remain a low-risk option and they provide higher returns than the likes of savings accounts.
Investing funds into property has always been viewed as low-risk. This investment type can provide monthly cash flow as well as seeing impressive lumps sums in terms of equity growth (should you choose to see).
Returns will depend upon the location that you invest in as well as the market conditions. However, long-term property prices will always increase.
Money Market Funds
A money market fund is somewhere to hold savings while receiving a slightly higher return than you would on cash. These funds invest in short term debt from governments and companies who are performing solidly. This is what makes them low-risk.
The other appeal here is that there is high liquidity. Investors are able to cash out relatively quickly.
There are numerous options if you are seeking low risk investments opportunities. While you may prefer the thrill of investing in an online casino UK, the options explored here will bring you a great deal more security even if they do lack excitement.
These types of investments are perfect for those exercising caution. They are for people who may be risk-averse but who still want their money to work for them. While the returns will be relatively low they are also reliable and can be invested into with confidence. However, no investment opportunity can ever offer a 100% guarantee.