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We continue our focus this week on increasing your investment savvy with yet another important term. This week’s term is: Investment Horizon

The investment horizon is the length of time a sum of money is expected to be invested i.e. held in a security or portfolio. An individual's investment horizon depends on when and how much money is needed, and the horizon influences the investment strategy. In general, the shorter the investor's horizon, the less risk he/she should be willing to accept.

What does this mean for you?

There are a number of factors, which may dictate an individual’s investment horizon. These include the investor’s age and his investment strategy. For example, someone who has just started working but has already started planning for retirement would have a greater horizon say about twenty to thirty years as opposed to someone who is nearing retirement. The younger person can therefore decide to invest in high risk/high return investments because of the time still available to them. The older person however, approaching retirement with a closer investment horizon would seek low risk investments. Thinking of purchasing shares, government bonds or just need some investment advice, call ECFH Global Investment Solutions at 457-7233.