If you’re new to investing, there are lots of terms and concepts to understand. While it may seem intimidating, gaining an understanding of these six basic concepts can build your confidence in making investment decisions for yourself and the plans you serve.
1. Risk and Return
Watch to Learn: How the levels of risk and return vary with each type of asset and why diversifying your portfolio helps manage risk.
2. Time Horizon
Watch to Learn: Why the time horizon of an investment is important to consider and how returns adjust over time.
3. Diversification
Watch to Learn: How asset classes perform differently from one another and why diversification is a key strategy for managing risk.
4. Asset Allocation
Watch to Learn: Why it’s important to tailor your fund’s asset allocation to fit your current and prospective circumstances.
5. Know Your Plan
Watch to Learn: What questions you need to ask about your plan to help select the appropriate investment allocation.
6. Monitoring Your Investments
Watch to Learn: Why it’s important to continue to monitor your investments—being aware of fees, reviewing results and asking questions.
If you’re a trustee looking for more information, visit the International Foundation Trustee Resource Center to find these investment management videos and more!
Brenda Hofmann
Communications Manager at the International Foundation
The latest from Word on Benefits:
- President-Elect Trump Regulatory Outlook
- SECURE 2.0 Act: What’s Coming in 2025?
- Implementing a Practical Financial Wellness Program
- Mental Health and Substance Use Disorders: Canadian Employees Continue to Struggle as Employers Focus on Education and Prevention
- Leading with Emotional Intelligence (EQ) in the Workplace
