Chapter 11 · Open anytime
Your investment policy
An investment policy is one page you write for yourself, before investing, and follow when markets get scary.
The idea
In short
- 1An investment policy is one page you write for yourself, before investing, and follow when markets get scary.
- 2It answers: What is the money for? When will I need it (horizon)? What mix will I hold? How much will I add each month? Which platform and funds (and their costs)? When will I rebalance? What will I do after a fall of −30%?
- 3Money needed within about 3 years doesn't go in stocks. Long-term money can take more risk.
- 4Write the answer to the −30% question now: “I will keep my mix and rebalance”, not “I'll see”.
- 5Review it once a year or when your life changes, never in the middle of a panic.
Your turn
Write your own policy
Loading your policy…
Practice, not scored
Quiz
1. Your goal is a house deposit in 2 years. Where should that money be?
2. When should you change your investment policy?