Investing for the short or long term

A question of risk and potential return

Investing for the short or long term

A question of risk and potential return

Prefer to invest over the short term or the long term?

Investing is one way of getting a return on your money, but unfortunately that doesn't usually happen overnight.
It is often a long-term process, one requiring patience, dedication and composure, especially if the market is volatile.
When you invest, you are best advised to carefully monitor the market and properly assess the risks.

Perhaps you've already heard of short-term investments and long-term investments, but are unsure of what they entail, what the difference is, or which investment strategy is best for you. Whatever the case, we're more than happy to provide a word of explanation.

What is short-term investing?

With a short-term investment, there is more chance that you maximise return over a period of three years or less, and then sell the investment. Often investments are sold within a matter of hours.
Short-term investing is also known as 'speculation'.
 

Short-term investing is risky.
You need to have adequate knowledge of the subject before embarking on short-term investing. You should also be prepared to take risks and to monitor the market closely.
It is often easier and safer at the start to plan long-term investments.

Advantages:
  • Potential to earn a higher return
  • The investment can be sold in the short term
  • A good understanding of the sector or company is not required

Disadvantages:

  • Higher degree of risk due to market volatility
  • Adequate monitoring (time) required
  • Considerable amount of investment expertise required
     

What is long-term investing?

With a long-term investment, there is more chance that you maximise return over a period of 10 years. Long-term investing involves pursuing a strategy over a longer period.

When investing over the long term, you leave the market to its own devices in the longer term.
You shouldn't panic if your shares fall in value and you shouldn't sell when the situation looks bad on the market. The market is cyclical in nature and has always recovered after falling in the past, though it may take some time to do so.

Advantages:

  • Less risk involved
  • Less monitoring required
  • Also attractive for less experienced investors

Disadvantages:

  • Potentially lower return
  • Commitment to putting your money into investments over the long term
  • Some understanding of the sector and company you invest in required

More information

Whether you're someone who prefers low risks and lower gains as a result, or someone who's prepared to run more risk for a potentially higher return, a combination of short-term and long-term investments could well be the best option. 
We'll be happy to provide you with expert advice.

Was this page useful to you? Yes No

Investments for everyone

  • What is a KBC Investment Plan?
  • Invest small amounts (starting from 25 euros)
  • Follow the steps in KBC Mobile to start investing in no time
Investments for everyone

Periodic investment: easier than you might think

  • Want to get more from your savings? Start investing regularly
  • Periodic investing may offer higher returns, but also greater risks
  • Start investing regularly with ease
Periodic investment: easier than you might think

Invest as a beginner

  • Practical tips from our financial experts
  • Find the type of investment that fits you
  • Download a free guide
Invest as a beginner

Investing on behalf of your child

  • Increase your savings by investing
  • Build a nest egg as your child grows
  • See what a KBC Investment Plan can do for your child
Investing on behalf of your child
We use cookies and similar technologies to make our website work better for you and ensure your online experience with us is more enjoyable and rewarding. We may also adapt our website to your needs and preferences. By continuing to use this website, you consent to our use of cookies.Learn more or reject cookies.