Investments-Look before you leap

We’ve all heard the saying, ‘If it seems too good to be true it probably is’, yet many investors still sign up for something which isn’t all it’s cracked up to be.

Any kind of investment will carry a risk, but there are some key things to look out for when considering different investment opportunities that will help prevent any unpleasant surprises.

Charges and costs

Admin and investment management charges-Both of these charges are part of the ongoing annual charge for the product. The admin cost covers both the calculation of the fund and the communication with you. The investment management charge is for the work that is done to source and select the specific investments that make up the product.

Low introductory rates

These are used to entice investors but are increased further down the line. Teaser rates being offered are a hot topic of conversation so we would advise you to keep an eye on any existing accounts where the low rate may be coming to an end.

How risky is it?

Investment opportunities will focus on past performance, but this does not always indicate how it will perform in the future. The make-up of your investment portfolio should be well balanced.

Talk to a pro

We would recommend speaking to an expert from the industry you are interested in investing in. Investment bankers who specialise in that industry or professional investors who focus in this category are a couple of good examples.

Does the product have a competitive advantage?

This is the barrier that stops competitors from taking the market share and helps make the company more profitable than its competitors making your investment better over the long term.

The value of pension and investments and the income they produce can fall as well as rise. You may get back less than you invested.