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Investing basics

Learn about the main asset classes and the importance of diversification and the principle of risk and return

Important information - please keep in mind that the value of investments can go down as well as up, so you may get back less than you invest. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser.

Investing in assets

You can choose to invest in a range of funds, which invest in different types of assets, like equities, bonds, or cash. The performance of different asset classes will naturally vary over time. As each asset class has its own unique characteristics, wider market conditions and world events will affect them differently. You may choose to invest your contributions in any or all of the following asset classes.

The main asset classes

Learn more about the benefits and considerations for each asset class.


The Cash Fund invests principally in Euro denominated Money Market Instruments, reverse repurchase agreements and deposits.

Things to consider


Bonds are corporate and government loans with you playing the part of the lender, in exchange for receiving interest payments over a set period of time.

Things to consider


Equities are shares in companies. They’re considered to be higher risk than cash and are much more liquid than property. Shares in companies provide dividends and capital growth, meaning that they generally outperform other asset classes over time, particularly bonds and cash. There is also the bene

Things to consider


Property funds often invest in commercial property rather than the residential market but you should still consider your house and any buy-to-let properties you own as part of your investment portfolio. (Can we shorten text)

Things to consider


Diversification is essentially the principle of not ‘putting all your eggs in one basket’. In investment terms, this means if you invest all your money into one fund or one type of asset class and it does badly, you could face a big loss. If you spread-out or ‘diversify’ your portfolio across a number of different investments, you’ll be in a better position to withstand any potential losses from a single asset class. Diversification aims to manage investment risk but it cannot eliminate it. 

You can further diversify your portfolio by:

  • Investing in a combination of stock markets within different countries, so that your investment won’t depend on the fortunes of just one market, such as the UK.
  • Investing in a mixture of the various types of investment funds, spreading your money across equities, property, bonds and cash, helping to minimise the impact of a single asset class on your portfolio.