Risk ladder

How different investments compare in terms of their risk

Whichever type of investment you choose it's important to remember that its value, and any income from it, can go down as well up and you could lose the money you invested. However, different types of investment do carry different risks: use the information below to help identify the different levels of risk and return associated with different types of investment. Please bear in mind that each category can cover a broad spectrum of investments, so do make sure you understand what it is you intend to buy, read the Prospectus or product information available from the issuer, and be sure you understand its risks. If you're not sure whether an investment is suitable for you, we'd recommend you seek independent financial advice.

Risk and return

Different types of investments have different risk characteristics … typically, the higher you go up the 'risk ladder' the higher the risk and the higher the potential returns. And not all of the available investments within one investment class will be equal either; for instance, a fund investing in UK Corporate Bonds will have a lower risk profile than one investing in UK Shares

Click on each rung of our 'risk ladder' to read more about its characteristics and for links to more information about that investment type. It is, of course, important that you understand the investment risk associated with any investment an that, if you're unsure, you seek independent financial advice.

  Class Investment Risk and potential
return
  Derivative CFD & Spread Bets
High
  Derivative Structured Products
^
  Derivative Covered Warrants
^
  Commodity Derivative ETCs
^
  Equity Small-Cap equities
^
  Equity Mid-Cap Int'l equities
^
  Equity Mid-Cap UK equities
^
  Equity Large-Cap Int'l equities
^
  Equity Large-Cap UK equities
^
  Inv Trust Investment Trusts
^
  Fund UK Index ETFs
^
  Fund Equity Funds
^
  Property Property
^
  Bond Bonds
^
  Gilt Gilts
^
  Cash Cash
Low
         

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