This section refers to general investment objectives, not the client's specific needs such as retirement at a certain age or college plans for his/her children (see the next section on capital needs). However, there is certainly a correlation between the two, and it is useful to know the characteristics of each of these investment goals:
- Preservation of capital - the investor is more concerned with safety than return. Treasury bills and money market funds may be most appropriate.
- Current income- the investor needs a portfolio that produces steady income for current living expenses. Bonds, annuities, and stocks with high dividends (such as utility stocks) may be appropriate.
- Tax-exempt income - the investor's
- Growth and income - the investor is looking for a portfolio that generates some amount of income, but he/she is looking for capital appreciation as well (often for protection against inflation). Appropriate investments could include a mix of bonds and stocks.
- Capital appreciation - the investor's goal is likely retirement or another event in the future, where growth is required and current income is not needed. A diversified stock or mutual fund portfolio is appropriate.
- Aggressive growth - the investor is looking for high-risk investments with a potential for very large returns. This is rarely the goal for an entire portfolio, but rather for a specific portion of assets. Aggressive growth funds and small-cap issues may be most appropriate.
FINRA Conduct Rule 2310
InvestingDiscover the various categories of income funds and the types of investors for whom they are appropriate.
InvestingEvery investment is a vehicle for safety, income or growth; but many times, the success of one objective comes at the expense of another.
RetirementRetirement means changing your investment goals from growing assets to generating income. Here's how.
Financial AdvisorThe "ideal" retirement portfolio can differ from one investor to another, but some themes hold true no matter what.
RetirementYou need to plan ahead to ensure a long and happy future away from the daily grind.
RetirementWe will design a portfolio that should balance the requirements of liberal income with sufficient liquidity to withstand down markets.