Cash and bonds

The value of investments can fall as well as rise. You may get back less than you invest.

Cash is a low-risk investment. A bank repays it on demand in most cases and even pays you interest.

When you invest in a bond, you effectively lend money to the provider. Your money is at risk because there's a chance that the issuer won't be able to make repayments. Bonds tend to pay a fixed interest rate although some returns are linked to a benchmark such as an index.

The returns are potentially higher but you'll need to deposit your money over a longer period. And, if you sell a bond before it matures, you might get back less than you paid for it. If the bond issuer can't repay you, you can lose all of your capital.