Everyone has a different and entirely personal attitude to risk. One investor may be comfortable with a relatively high level of volatility, in the expectation of long-term rewards. Other investors may be deeply concerned about even small year-on-year fluctuations in value. Personal risk tolerance is the foundation of establishing a suitably risk-controlled strategy.
Is the investment suitably flexible, giving you the right access to capital and/or income? Is there sufficient choice within the investment to enable diversification?
Is the volatility within your tolerance levels? Do the risks match the rewards?
The charges should be as low as possible. High charges have a detrimental effect on the growth potential of an investment. The charges need to be fully transparent.
The performance of the investment needs to be measured in absolute and relative terms.
The tax status of an investment suits different personal circumstances and objectives. Tax relief should be optimised where possible and when appropriate.