Choosing the right investments

Before you invest, it’s important to identify your investor profile.

Then it’s time to choose your investments.

First, you have to understand the relationship between your investor profile, the minimum time frames for investing and the chance of negative returns. The diagram below shows this concept. 
 
If you are a conservative investor, then you need to invest for a minimum of 3 years. As the diagram shows, there’s a chance of a negative return happening on average once in every 9 years.

At the opposite end of the scale, if your investor profile is aggressive, the chance of negative return increases to one in 4 years - so your minimum timeframe for investment increases to 7 or more years.
 
Now you can consider the possible types of asset classes that could suit your investor profile. 
 
To find out more about each of the asset classes, it is recommended you talk to your financial planner.