Understanding risk All investing has risks attached to any potential reward, but this can vary from investment to investment. You need to ensure you're happy with the risks involved with whatever you choose to invest in. The higher the risk of an investment the higher the potential returns it will make, however you increase the potential to lose some or all of your money and the investment will most likely be more volatile. The funds we offer contain different asset types and the variance in those asset types influences the amount of risk the fund has. For example a fund with greater proportion of its investment in company shares compared to cash or company bonds will have a higher level of risk than the other way around. Below we explain the different factors you need to consider to evaluate how much risk you are willing to take and how to evaluate the risk of each fund. We also explain the assets used and how to find the proportion of those in each fund. How to approach risk Time horizon Investing is best when you think long-term for five years or more. It means your investments may be able to recover any short-term losses, as well as benefit from compound returns essentially returns on any investment returns you make. Diversification Owning different types of investments through something like an investment fund (or having multiple investment funds) means if one doesn't perform well, you could still receive the potential returns of others. Combining different asset classes Multi-asset funds essentially blend different types of investments together. This is so you’re not putting all your eggs in one basket and can benefit from the performance of different asset classes at once. Spreading your money across a variety of investments is known as diversification and is one way of managing risk. Why choose us? Over £1.2tn assets under management* Award-winning customer service Risk warning Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest. Tax rules may change in the future and their tax advantages depend on your individual circumstances. *Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor, with over £1.2 trillion in total assets under management at 31 December 2019. Facebook Instagram LinkedIn YouTube Twitter Accessibility Legal and regulatory information Privacy policy Cookie policy Security information Sitemap All our websites About us Making a complaint Group website Modern Slavery Statement Careers © Legal & General Group plc 2021 Close widget Do you have a question? Send message This Website uses Cookies We use cookies to make this website work, and to understand how you use it. This helps us to improve our service and your online experience. Cookies may also collect limited data about your interactions with websites that we may use to provide you with specific content, or to share relevant offers on other websites and social media. You can read our cookie policy to find out more about the cookies that we will store on your computer or device. You can easily customise your cookie settings at any time by using the link at the bottom of our website. For the best experience, we recommend that you accept all cookies. Customise Cookie Settings ✓ Accept All Cookies