If there is one rule that unifies all investment vehicles, it is that there is no such thing as a guaranteed return. This stands to reason, as even the most stable financial markets are vulnerable to change and the threat posed by external, economic conditions.
This assertion at least reveals that stable markets do exist, however, meaning that it is possible for individuals to remove some of the uncertainty that surrounds their investment plan over time. The key is to identify these, and ultimately create a portfolio that is largely risk averse in its nature.
3 investment vehicles that offer security to investors
With this in mind, here are three investment vehicles that can offer some security in the modern age, regardless of the prevailing economic climate:
- Money market funds
While bonds are relatively diverse assets in terms of risk and reward, there are also iterations that help you to minimise your risk as an investor. Take money market funds, for example, which are essentially short-terms bonds and securities that are traded on the open market. They include individual asset classes such as CDs and municipal bonds, and are renowned for their extreme liquidity and accessibility to investors. As you can buy or sell shares in real-time, it is possible to minimise your risk at any given point in time.
While it is often overlooked, your choice of pension plan represents a significant investment decision that can have a critical bearing on your financial future. There is also a diverse range of pension plans available in the modern age, some of which can help you to strike the ideal balance between risk and your likely return.
One of the most alluring benefits of a SIPP is that it affords you access to a number of low-risk asset classes, enabling you to tailor your plan to suit your outlook. These plans can also include ready-made investment portfolios, which are managed by experts in line with particular tolerances to risk.
- Dividend investments
Dividend investments offer you access to renowned, blue-chip stocks that deliver a consistent income. This includes premier and market leading brands such as Coca Cola, which often sees its share values grow annually in line with sustained market expansion. Dividend investments are therefore seen as being more secure than other investments, and while they may not offer huge returns they can deliver a regular source of income to investors on a quarterly basis.