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Guaranteed Returns Investment - The Best Guaranteed Returns Investment - Guaranteed Returns Investments UK

The Advantages and Disadvantages of the Guaranteed Returns Investment

Investment is typically a risky business. Stocks and shares, equities and bonds – it can be nice when our portfolio shows growth and our pot of gold becomes ever larger before our eyes. The difficulty arises when that doesn’t happen. Some invest small fortunes, indeed some large fortunes, and lose everything when the market sways in the wrong direction and takes their life savings in its wake.

As a general rule of thumb the higher the dividend the greater is the risk, whilst conversely a cautious investment portfolio spread across low-risk options tends be safer, but then often only marginally productive. When one considers the volatility of the market and the potential for the value of investments to decrease rather than increase, the temptation to plump for some form of guaranteed returns investment instead of taking a gamble is often considerable. The rationale of the guaranteed returns investment is actually quite simple, viz. that the investor sacrifices a percentage of any profit in return for the peace of mind that comes with knowing that all the hard-earned savings and income that have been committed to it are safe and secure.

As always there is a catch, and that catch is that the yield on investments such as these is typically low. The simple reason for this is that somebody else is taking a risk by underwriting your investment whatever occurs in the market and as such expects to be compensated for that risk. When your investment shows a profit your guarantor will collect a share of your dividend before passing over the remainder to you.

Before committing to such an investment then it is important for the investor to establish precisely what are the terms involved. First of all what is the minimum return that is guaranteed? Sometimes it is no more than the initial stake and, if that is the case, the investor may wish to consider whether having all that money tied up for so long in a zero-profit adventure is worthwhile.

Secondly there are likely to be conditions in relation to the length of time for which the funds must be committed for a guaranteed returns investment, which could run into many years. Often there is a surrender charge which could indeed mean the investor making a loss if the policy was to be terminated before it was to reach maturity.

There is no “best” approach to guaranteed returns investment or higher risk investing alike, is it down entirely to the individual to assess the extent of the risk and to make an informed decision on the basis of all the facts. Search for investment opportunities using the above companies.

 
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