For many the thrill
and excitement of “taking the plunge” makes all
the risks worthwhile. For many others though it is a reckless
strategy over which pursuing a low-risk, low-return, safety
first strategy is to be preferred.
It really is a question
of horses for courses. What is important is that the potential
investor is properly apprised of the risks involved and can
take an informed decision based upon this information.
In this respect the
best investment returns are not always the ones that pay the
most when successful. What is “best” is what actually
suits the investor the most, and that may just as easily mean
a cautious investment commanding a low yield than a lighting
raid that has the propensity to go wrong.
The safest way to
invest is probably to create a diverse portfolio of investments,
including bonds and equities, spreading any risk and thereby
increasing the chances of a positive return even if not every
investment is successful.
Investment is for
the long term, and success is being able to take out more than
one has put in after having factored in inflation and the consequential
shrinkage in your currency’s overall value. Making large
gains that could so easily have been losses is success of a
sort, but in the final analysis it could be said to have just
as much to do with good fortune.