When it comes to squirrelling money away, an investor is faced with many choices, which hold the potential to confuse and intimidate. Among the most basic of these is the decision on which kind of "asset class" offers the best home for their money, or is likely to provide the best return.
Investment wisdom dictates that a grand total of four asset classes are open to investors, with the merits of each depending on an individual's needs or attitude to their nest-egg.
In the foreground we have equities, or stocks and shares, the class which has traditionally offered the most significant returns over the longer term. History says that when equities come in for a beating, their appeal is reduced, with even more experienced investors left scrabbling for some kind of alternative. This is the kind of situation that currently prevails.
The asset classes ready to step into the gap are bonds, cash and property, all of which have historically offered steady, if not earth-shattering, growth opportunities. Of these, the most conservative and most accessible is probably cash, or the plain old deposit account. Bonds come next, but given their relative lack of accessibility to smaller investors, they tend not to figure highly on the average investment spectrum.
Finally, we have property, the class dear to the heart of most Irish people. Again, returns are not guaranteed, but at least if everything falls flat, there is always the comfort of a shelter from the cold.
