Investing

When investing, you can never guarantee the returns you might get, but there are things you can do to boost the potential for a positive outcome. Here are eight guiding principles that could help manage your risk and improve your chances of achieving reliable long-term returns.

Having a goal in mind can really help you focus your investment strategy. At Nutmeg, we see some fascinating patterns emerge when we look at the kind of goals our customers are working towards, particularly when viewed alongside the level of risk they opt for and the amount they are aiming to accrue. We also see a number of trends between men and women and across different age groups.

When stock markets are volatile, a natural instinct is to sell, or move your investments. But, as history tells us, this could really damage your future returns. Standing firm and resisting the temptation to tinker with your portfolio as its value shifts – when it’s up, as well as when it’s down – is the cornerstone of successful long-term investing.

As the government fast-tracks its controversial Help to Buy scheme, we trawl the data to reveal the state of the UK’s regional property markets today. 

Many investors are well aware of stock market opportunities in developing economies – so-called Emerging Markets. EM equity funds are always found in the top 10 best-selling lists of funds with private investors, despite considerable underperformance in EM equities compared to developed markets.

The bad news is that no non-ISA cash accounts beat the current rate of inflation. With the latest Consumer Prices Index standing at 2.8 per cent, a basic rate taxpayer would have to find a savings account paying at least 3.5 per cent to negate the effects of tax and inflation. A higher rate taxpayer, meanwhile, would have to find an account paying at least 4.66 per cent. Such rates simply don’t exist at the moment.

The All Party Parliamentary Group (APPG) on Financial Education for Young People recently produced questions that test what it thinks GCSE-age children should know. Would you get an A*? Or are you nearer the bottom of your class?

Many things lose their value the moment you own them. A new car famously plummets in price as soon you drive it out the garage, typically losing half its value in just three years. Few people will pay top price for an old jumper, a well-thumbed book or a second-hand half-pint of beer.