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Different Approaches to Investing Your Money

Updated on December 6, 2011

Everyone that invests has an approach

Everyone that invests their money is using an investment strategy of some kind whether they realize it or not. One can look at your investments and see where you choose to place your money. This will show what kind of strategy you are using. There are a few main approaches for strategies that you may see most often. These include a conservative approach (this is where I probably fall), a more moderate approach, and the speculative approach. The speculative approach leaves me feeling uncomfortable so I leave those for the others.

I love this art by Paolo Veronese
I love this art by Paolo Veronese

Different Approaches to Investing


Investing conservatively is good in that it takes on only a limited amount of risks. This approach concentrates on liquid and secure stock and higher rated fixed income investments.


The moderate approach takes risks by putting money into mutual funds, bonds and growth stocks.


Investors that use the speculative approach take what can be called major risks on investments with results that are completely unpredictable.

Hans Holbein - Another beautiful piece of art
Hans Holbein - Another beautiful piece of art

Some Low, Limited, Moderate, and High Risk Investments

Some people break things down into 4 groups. These might be High Risk, Moderate Risk, Limited Risk and Low Risk. Its the same basic principles at play however. Some Low risk investments might include Treasury Bonds, and Bills, Money Market Funds, and Bank CDs.

As for Limited Risk Investments, they may include things like Blue Chip Stocks, High Rated Corporate Bonds, Index Mutual Funds, and Higher rated Municipal Bonds.

For those feeling a little big more confident and/or have a bit more money to "play with", you might consider the moderate or high risk investments. Moderate Risk Investments may include things like Growth Stocks, International Investments, and Low Rated Corporate Bonds.

The Highest Risk investments could include things like High Yield Bonds, Futures, and Speculative Stocks. It is tempting when you see others do very well in the higher risk investments, and it can cause one to feel secure in adopting similar strategies.

It can help to keep the example of the Pyramid Structure in mind, when in investing. This is my opinion and can help you stay safe even if you want to invest in the higher risk categories. The highest risks would be at the top of your pyramid, thus the smallest percentage of your money would be tied up in it, yet you can still be a part of those possible rewards.

Four approaches in Real Estate Investing


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    • oceansnsunsets profile image

      Paula 6 years ago from The Midwest, USA

      Hi Phoenix, thank you very much, I always appreciate your comments. :)

    • PhoenixV profile image

      PhoenixV 6 years ago from USA

      All good ideas.