Video transcript

Asset class describes the different types of investment you can choose to put your money into.

They’re grouped according to the different financial characteristics they share.

Broadly speaking, assets fall into the following categories:

Cash
Stocks
Bonds
Commodities
Property
Alternatives

Each asset class comes with a different level of risk and therefore potential reward, and will react differently at different points in the economic cycle.

Often the best way to build a financial portfolio is to have a blend of asset classes to control or adjust the risk you are taking, which will be determined by your financial needs and factors such as your age.