What’s a safe or low-risk investment to most people?
• You know what you will make before you invest. There are few unknowns and no surprises. • You won’t lose any of the money you invest. You always know you’ll get back at least as much as you started with. • It’s not hard to understand how the investment works. You know what you’re getting into. • Your money grows slowly but surely. There are fewer ups and downs. A good visual is the old playground teeter-totter: Picture these investments at the centre of the teeter-totter, so it moves very little. Examples: Guaranteed Investment Certificates (GICs), Canada Savings Bonds (CSBs), savings accounts, T-bills, money market funds. What feels like a risky investment to most people? • You don’t know what you’ll make. You can make a good guess, but there is no guarantee. You may even lose money. • It’s harder to understand. There are many things that can affect what happens to the money you invest. • The value of your investment changes a lot. It could even drop suddenly and take years to climb
