InvestorQ : What is capital preservation for long term investments?
Neelam Naik made post

What is capital preservation for long term investments?

Answer
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Rishita Das answered.
1 year ago


Capital preservation is a conservative investment strategy where the primary goal is to preserve capital and prevent loss in a portfolio. It is generally preferred by those near to their retirement period. Since the rate of return under this strategy is designed only to keep up with inflation, by ensuring that the overall value of their investment does not decrease.

There are not many benefits of capital preservation in long-run, besides aiming for growth of the overall portfolio balancing risk and return. Major benefits of this strategy are in the short run as the effect of inflation is minimized in the short-term.