When you decide that it is time to invest, your investment style has to be a factor in what your advisor chooses for your portfolio. Typically, they will try to determine whether you have a preference for aggressive or conservative investing. These are two very different options, but there are some benefits to having a mixed portfolio.
One of the biggest differences between these two is that aggressive investments are a greater risk than their conservative counterparts. This can mean that you are able to make more money faster; however, there is a chance that you could lose it all. It is imperative that you only invest what you can afford to lose in an aggressive portfolio.
Choosing a conservative portfolio is on the other end of the spectrum. These come with minimal risks, but there are still some that are present. This type of portfolio usually has a mix of 80 percent bonds and 20 percent stocks. The safe nature of these investments means that you likely won’t see as big of a possible return as you could with the aggressive portfolio.
With a mix of these two, you can choose how you want to split them. You should think about the short-term benefits, but you must also consider the long-term implications of your decisions. An ethical advisor will help you determine what is best for your situation based on your needs and goals. Be wary of one that tries to push too hard for a portfolio that you aren’t comfortable with. This might be a sign that you need to reconsider using that individual to handle your investments.
