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Risk and reward explained

If you're about to start investing, the most important thing to consider is your attitude to risk. How much money are you willing to risk for a potential reward?

Risk and reward

Among investment products, typically:

  • High-risk investments offer potentially higher returns
  • Low-risk investments offer potentially lower returns

Your attitude to risk

Keeping your goals in mind, have you asked yourself the questions below:

  • Do I have time to make long-term investments, which would allow me to take greater risks for higher returns?
  • Can I afford to lose some of the money I invest in short-term, high-risk investments? Can I manage short-term fluctuations and drops in the value of my holdings by investing for a longer period?
  • What risk level can I take while still protecting my children's future?
  • Am I fine with potentially low returns if it means my money is safer?
  • If I go for safer investments, will the returns be enough to cover inflation?

High risk vs low risk

Everyone has different reasons for saving and often your wealth management goals can be a deciding element in how much risk you're prepared to take with your money.

If you're making a wealth management plan for your children's education, then you might be investing over a long period of time and looking for a high return. As a result, you might prefer a comparatively high-risk investment option.

Should your goal be to purchase a new car, go on holiday or decorate a house, you will be investing for the short term and expecting a guarantee of your investment. Accordingly, you may prefer a low-risk investment option.

More products and information

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You could check our insurance partner policies including Health insurance, and Life insurance, and our Online service.

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Frequently asked questions

1. What are the basic rules to making investments?

You first need to understand your financial needs, investment objectives, financial situation and risk appetite. 

Your goals may include the following:  

Protect your family

Children's education

Retirement planning

Wealth management and growth

Legacy planning

You should also consider your goals, investment tenor, affordable investment amount and personal investment preferences.

2. When should I start financial planning for my future? How should I approach financial planning?

Financial planning is a sound financial management process to develop and achieve personal and family financial goals through investments, asset allocation, risk control and retirement planning. Financial planning is not simply saving money or cutting living costs. Reasonable financial planning can help individuals and families set financial goals for different life stages and help them achieve these financial goals through proper investment tools and portfolios. It could contribute to wealth accumulation and growth as well as prepare individuals and families to respond to adverse effects of unexpected events.

There is no set formula for financial planning. It varies by person, circumstance and life stage. You should start your financial planning as early as possible.

3. Where can I get more information about investment products?

You may contact your relationship manager or call our hotline at 400-820-8828 (for Premier customers)/ 400-820-8878 (for Advance customers) at your convenience,Please dial the country code of mainland China +86 if you are calling from overseas, Hong Kong SAR, Macau SAR, or Taiwan.


Although the above information is carefully written, the Bank does not warrant, state or guarantee the accuracy or completeness of the above information. The above information is not and should not be regarded as an offer or purchase invitation for any financial product, nor should it be viewed as an investment proposal.