Robo performance for high-risk portfolios
28 Jan, 2022
Who were the top performers?
And what exactly is 'high risk'?
The financial industry has an annoying habit of throwing around terms like 'high risk' and 'low risk' as if they always mean the same thing to every person. In truth, investment platforms have slightly different criteria for determining which risk category to assign to their investment portfolios.
So for clarity's sake, here's a quick overview of what a high-risk robo portfolio should look like and what you might expect in terms of performance.
If you're a high-risk investor, you'll be investing most of your money in company shares.
That means you'll be much more exposed to the 'ups' and 'downs' of the market.
Our recent robo data show that people who invested in ready-made or robo high-risk portfolios got the best bang for their buck in the last two years.
But be prepared. There's a higher chance that you may lose all your money compared to low- or medium-risk portfolios.
High-risk investing is not a good option for people looking to put their money away for a shorter period (i.e. 3 years), because if you need to withdraw your money when the market is swinging in the wrong direction, you may lose more than you put in.
Common adjectives used to describe this type of robo portfolio include adventurous, aggressive or simply 'high-risk'.
Boring Money collects performance data, in some cases through its own test accounts with the providers. The % allocated to shares is based on the data available at the end of December 2021 and may vary over time.
The portfolios selected here are those identified by Boring Money as the high-risk options most prominently presented to customers. Some providers may have other portfolios available at different risk levels (i.e by offering more than 3 portfolio options).
Average performance figures below are the median average return for the risk level.
High Risk Portfolios
Lower risk portfolios have returned on average 22.39% since the start of January 2020. For comparison, the FTSE 100 returned -3.12% and the S&P 500 returned 47.34% for the same two-year period. Money in the top paying 2 year fixed Cash ISA is currently earning 1.2% a year.
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