Investment horizon

The investment horizon refers to the period of time for which an investor plans to invest their money until it is needed again.

It is crucial for choosing an investment strategy, as it determines how much risk can be taken. A long investment horizon allows for higher risks and higher-yield investments, such as stocks. Conversely, with a short investment horizon, less volatile investments, such as bonds, should be given greater weight.

The investment horizon should suit the investor. However, the product, such as a pillar 3a securities account, should not limit the investment period. For example, a 60-year-old who wants to invest their assets for 15 years will base their investment strategy on this investment horizon. If, on the other hand, he were to choose a five-year horizon simply because he will then reach his AHV reference age and have to withdraw his pillar 3a assets, this would cost him in terms of returns. This is because, upon retirement, the capital paid out from pillar 3a can and should remain invested in an untied portfolio in line with the existing investment strategy.