by Jennifer Hill from interactive investor, 30th October 2023:
Investing for children and grandchildren is a great way to build a nest egg, and with a long time frame there’s plenty of time to ride out the inevitable ebbs and flows of investment markets…
The general rule of thumb is that the younger you are, the more risk you can afford to take and the greater potential return you stand to gain…
The perfect number of funds in a portfolio for a child depends on several factors, including the investor’s investment strategy and time commitment…
So, in which funds and investment trusts are the professionals investing for the children in their lives?
Alliance Trust
Back in the noughties, when his nieces (now aged 23 and 20) started school, James Carthew, head of investment companies at QuotedData, began saving regularly on their behalf, all of which was invested in multi-manager proposition Alliance Trust.
He says: “My reasoning was that it offers broad exposure to global equity markets, without taking on too much risk. They both got a nice lump sum when they started university, which to be fair would have been bigger had I been reinvesting the dividends – always a good idea.”
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