Invest for Growth

At certain periods in your life, you’ll want to consider whether you are growing,
protecting or harvesting your wealth. During the prime of your life, you will probably
want to invest to grow your capital, either through regular contributions into funds and
shares or the occasional single - or lump-sum - investment.

GROWTH

"Growth is all about capital returns"

Key factors

Those who invest for growth are typically people who are prepared to take a little more risk with their money. Exactly how much risk will depend on your personal comfort level and your time horizon (e.g. are you allowing long enough for the ups and downs of the stock market to smooth themselves out?)

A rule of thumb

Unlike income-paying investments that throw off a helpful dividend every so often, investing for growth is all about capital returns. In order to realize your profits you have to sell out of your position, making this form of investing all the more risky on the whole.

Time horizon:

Our model portfolio and goal-based fund selections have time horizon and risk level guides to help you choose the right investments for you.

Growth over time

The most popular form of growth investing is equities – the shares of companies. History has proven that if you hold a collection of equities over a substantial period of time then the chances are that you will make a profit.

Shares of large developed world companies are generally seen as the safest form of equity investment, as are often established market leaders with predictable earnings growth. That’s not to say that you won’t lose you money if you just bought shares in a multi-billion pound company of course; just ask BP investors in 2011 after a big oil spill!

Level of risk:

Our regular investing selections have time horizon and risk level guides to help you choose the right investments for you.

Equities - Potential with risk

If you’re not planning on touching your capital for a long period of time then you can allow yourself to dip into more volatile areas of the market. Riskier areas such as smaller companies and emerging markets have proven very popular in the past for those with a 10, 20 or 30 year time horizon.

While there is the chance that these areas can make you a great deal of money over the long run, they are generally more volatile and tend to be hit particularly hard during general market sell offs. They’re not for the faint-hearted, therefore.

Funds - Diversified exposure

You could buy direct equities yourself, but while this way of investing can make you a lot of money, the risk of putting all your eggs in one basket is not for the mainstream investor. Collective investment vehicles such as funds and investment trusts can offer investors more diversified exposure to equity markets, but because they are actively managed, investors have to pay up for their services. A cheaper option is to use passive funds or ETFs (exchange traded funds). These vehicles track the index they are investing in, giving investors low cost exposure to the markets.

Solutions

We have assembled some links around this page that are relevant to investors looking for solutions to their growth needs, whether they be ready made solutions or ‘pick your own’ investments.
"Start exploring!"

The Accumulator

Model Portfolio

This portfolio will take more risk in order to seek out capital growth.

Appropriate for younger investors who can accept higher risks for possible higher returns.

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5 BIG REASONS TO OPEN AN ACCOUNT
Lindsell: The stocks I’m backing in Lindsell Train Japanese Equity

Lindsell: The stocks I’m backing in Lindsell Train Japanese ...

by Anthony Luzio
15:00 - 17 November 2017

Editor, Trustnet Magazine
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Model portfolios

The Accumulator

Long term growth over 20 years.

Risk level - Adventurous

The Consolidator

Medium term wealth over 20 years.

Risk level - Balanced

The Income Generator

Investment income over 10 years.

Risk level - Balanced

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