Glossary entry
An investor commits money or other capital to an asset with the expectation of income, appreciation, or another financial benefit over time. Investors can be individuals or institutions with different objectives, obligations, and constraints. The role involves accepting uncertainty, evaluating evidence, and matching investments to the horizon and losses that can reasonably be tolerated.
Illustrative example
An individual buying a diversified fund for a future goal and a pension institution buying bonds are both investors, despite different responsibilities and resources.
What to consider
Being an investor does not require constant trading. Match decisions to objectives, financial capacity, and understanding of the assets involved.
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