What is a Defensive Investment Strategy?
A defensive investment strategy is one that includes a portfolio of investment options designed to minimize the risk of losses to the investor. Popular choices for a defensive investment strategy include bonds, currency, very safe stocks and perhaps precious metals. This type of investment strategy may be recommended for some as they get closer to retirement age, or for those who are not willing to risk much. Generally, a defensive investment strategy is not recommended for those who are just starting in their careers. At this stage, some amount of loss is acceptable, compared to the gain that can be realized. Also, if a loss does occur, there is more time to make it back. Therefore, a defensive investment strategy does not provide much in terms of financial gain for those looking at retirement decades into the future. However, for those who are approaching retirement, their strategy will likely need to change. By this time, the investor has probably built up a good amount of money in
