Your investment objectives

The first step towards a more effective investment strategy is deciding exactly what you are investing for. Your investment objectives are likely to change throughout your lifetime: a young person may have very different investment needs compared to a couple about to enter retirement.

Before you make any investment decisions, you need to identify your key investment objectives:

• Income (high income, regular etc)

• Capital Growth

• Income and growth

• Ethical investment

Risk versus reward

Most people are aware that there is a close relationship between risk and reward, but getting the right balance between the two will depend on a number of factors, including your investment objectives, how long you want to invest for and the pattern of return you are comfortable in accepting.

Attitude to risk & reward — key questions

Whether you are ultimately a low, medium or high risk investor will depend on your attitude to a variety of issues, including:

• Do you have sufficient cash–based funds to cover your short–term spending plans and emergencies (e.g. "rainy day" fund)?

• Are you investing for income, growth or a mixture of the two?

• If you want growth, will you need access to your investment? If so, when?

• If you want income, does it matter if the amount goes up and down?

• How much can you afford to invest? Are you able to save regularly or invest a lump sum (or a series of lump sums)?

• Can you cope with sudden, sharp movements in market prices? Would you be able to resist selling your investments just because they fell in value over a short period of time?

• If you have existing investments are they balanced in terms of their risk profile?

Deciding which investments most closely match your objectives can be a complicated exercise, and may require expert guidance.

Choosing the right investment

When it comes to investing, there are a variety of different asset classes or investment "building blocks" you could choose from.

• Cash / Moneymarket

• Fixed Interest or Bonds

• Equities / Stocks & Shares

• Property

• Commodities

• Structured investments

Managing your investments

One of the hardest aspects of investment is portfolio management — constructing a portfolio of assets that balances your return objective and risk profile. In reality, there are no guarantees when it comes to investment performance. The key to long–term investment success is diversification and effective portfolio management. This is where expert financial advice comes in to its own.

Blackden Financial has many years of advising clients from all walks of life, helping to select the most appropriate funds within their respective sectors for use within a diversified portfolio that matches investor’s objectives and risk profiles.

• We use a rigorous due diligence and research process that combines quantitative and qualitative analysis.

• Fund performance is analysed using our own screening system.

• Different styles and philosophies are combined in order to maximise the opportunity of meeting objectives whilst controlling and managing the level of risk taken.