Maximise your investments

Creating an investment portfolio is one thing. Managing it is quite another. There are a range of smart investment strategies and techniques you can use to supercharge your investments over time.

Regular investing

Making regular contributions to your investments is a great strategy for boosting your assets over time and enables you to take advantage of other investment strategies, such as dollar cost averaging. With as little as $1,000 to start, and by adding just $100 a month, you can start a regular investment plan into a managed fund or superannuation.

Compounding

Compound interest is what happens when you earn interest on your interest. It’s one of the easiest and fastest investment strategies for boosting your portfolio balance. The longer your money is invested, the bigger the effect compounding can have, so to take full advantage of this strategy, think about starting early.

Growth investments

Risk can be a good thing. Investing in slightly riskier options is a strategy that can deliver higher returns and help you to reach your goals faster. Your returns on growth investments, including property investing, Australian shares and international shares, may potentially be higher than those of traditionally defensive, or conservative, investments, such as cash.

Risk vs. return

Different types of investments carry different levels of risk, and also different returns. As a general rule, the larger the potential return, the higher the investment risk. Before you create a portfolio, it’s important to understand your tolerance for risk, techniques for managing risk, the relationship between the risk you take and the return you may receive.

Borrowing to invest

Borrowing money to invest is also known as ‘gearing’. When used correctly and sensibly, gearing can be one of the most effective investment strategies for boosting your returns. By increasing the amount of money you have to invest, you can earn returns on a larger amount. There may also be tax advantages associated with this strategy, along with risks with gearing, so it’s important you gain financial advice.

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• Important information
  The information contained on this web page is of a factual nature only and is not intended to constitute financial product advice. It has been prepared by Commonwealth Financial Planning Limited without considering your individual objectives, financial situation or needs. You should consider its appropriateness in light of your circumstances and consider seeking professional advice relevant to your individual needs before making a decision based on this information. Commonwealth Financial Planners are Representatives or Authorised Representatives of Commonwealth Financial Planning Limited ABN 65 003 900 169, AFSL 231139, a wholly owned but non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124.