If you want more, you must be willing to pay the price. This is what risk implies in most cases. Investments can be quite beneficial but how you approach them depends on how much you are also willing to lose. High-risk, high-return investment options are the types that promise you almost a double return and above on what you invest but, in most cases, the road to the end is bumpier and riskier than other options.
People perceive and assess risk differently when it comes to investments and these assessments determine the portfolio of one’s investment. Some people cannot tolerate the thought of losing their money. Others do not mind losing if it means winning in the end. The latter might always have a bounce-back option even after the stock market is shaken.
Common High-Risk Investments
While some of these might not be necessarily legal, a good number are a huge gamble that could lead to a total loss. The first common high-risk investment is mini-bonds or high interest returning bonds. Here, you give a loan to a company, mostly start-ups, and then agree at a date where you will receive your money back.
This investment is high-risk because start-ups cannot guarantee that their growth will match their growth analysis. You might have to wait longer than you expected. Worst case scenario, the company fails, and you lose your investment. The FCA does not cover these transactions, and though the ISA might be aware, there is nothing much they can do when you lose your investment.
Another similar example is the Venture Capital Trusts. Here you will gain some tax advantages and still get high returns. However, just like the mini-bonds, only the success of the companies can assure you of the safety of your investments.
Depending on your investment needs and money available any of the above options are a great choice.