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Savings & Investments

Overview
It is important to establish your attitude towards risk (or tolerance to volatility), your objective and the length of time your money will be invested for. Are you investing with a specific objective – to repay a mortgage or to pay school fees or are you simply looking to build-up your savings for the longer-term?

Making the most out of your savings
If you are looking for superior investment returns compared to holding money in a deposit-based account history has shown that asset-backed investments (such as equities, property and fixed-interest investments) have produced the higher returns over the medium to longer term, although they are not free from risk (volatility). To protect the purchasing power of your money any growth should be at least equal to the rise in the rate of inflation

Tax planning
For the majority of investors, the first consideration would be to take advantage of a tax-privileged environment for their savings. Popular choices include Individual Savings Account's (ISA's) and National Savings products. Fundamentally, however, the investment vehicle should be the right one for you so don’t let the ‘tax-tail wag the dog’ - if you are a non taxpayer make sure you do not pay tax unnecessarily; in the case of bank / building society savings ask the provider if they can pay the interest gross (if you are eligible)

Asset types
The main asset-backed investments are: - Equities (shares), Property & Fixed-Interest (corporate bonds & gilts). In return for potentially superior growth, asset-backed investments can fall as well as rise in value; this could mean that you could loose money particularly over the shorter-term. You should only invest money in asset-backed investments for the medium to longer-term; typically this would mean at least five years and probably longer in most cases

Spread your risk
Different types of investments perform in different ways; in general terms riskier investments (such as equities) have traditionally provided the best returns over the longer term. However, they can be the most volatile investment. Combining different types of investments in a portfolio (or investment product) can help to even-out volatile movements in the value of your investment

Investment funds
Investment product providers will typically offer a range of funds, to satisfy different requirements of investors. The process of selecting funds / fund managers is now more complex than ever.  You should consider the options and construct a portfolio to suit your needs

Sovereign Asset Management is a trading style of Sovereign Asset Management (Bristol) LLP, which is authorised & regulated by the Financial Services Authority; registration number 434895. Sovereign Asset Management (Bristol) LLP is registered in England & Wales, registration number OC313334. Any guidance contained within this website is subject to the UK regulatory regime; as such the content is for consumers only based in the UK. The FSA does not regulate all forms of Protection, Business Assurance or Tax Planning. Where this website offers links to any other websites, Sovereign Asset Management (Bristol) LLP have no control over the content and cannot be held responsible for the content or any material transmitted to your computer.