Capital preservation

Preservation of Capital

A conservative investment strategy that attempts merely to avoid the loss of value. Retirees often prefer this strategy for their savings because the rate of return is designed only to keep up with inflation, ensuring that the value of their savings does not decrease over time. This often works in the short-term for pensioners, but using capital preservation as a long-term strategy often adds exposure to inflation risk rather than reduces it. Capital preservation strategists usually invest in fixed-income securities and other low-risk investments.

Capital preservation.

Capital preservation is a strategy for protecting the money you have available to invest by choosing insured accounts or fixed-income investments that promise return of principal.

The downside of capital preservation over the long term is that by avoiding the potential risks of equity investing, you exposure yourself to inflation risk.

That's the case because your investments are unlikely to increase enough in value to offset the gradual loss of purchasing power that's a result of even moderate inflation.

References in periodicals archive ?
GNL is well established and presents a great opportunity for investors seeking capital preservation and high current yield in a challenging market environment.
Our aim is to provide investors with an attractive and inflating dividend alongside real capital preservation.
Capital preservation remains a significant focus of the bank's directors in consideration of the Basel III capital standards adopted, the company said.
KARACHI -- Al Meezan Investment Management Limited (Al Meezan) is pleased to announce the launch of Meezan Capital Preservation PlanII (MCPPII), which is the sixth in the series of capital protection / preservation plans / funds launched by the company.
The investment strategy of the company will focus on capital preservation, while offering potentially significant equity returns to shareholders.
Onex continues to believe that its success in building companies and its record of capital preservation and superior returns are direct results of the strong alignment of interests between Onex, its shareholders, the limited partners and the management team.
Tidjane Thiam, Pru's group chief financial officer, said: "We are focused on capital preservation and on profitable and capital efficient growth in all our markets.
Nabil Maroof, NBK Capital's Managing Director of Asset Management, said that "Investor flight to quality has driven the demand for NBK's extensive expertise and conservative approach which emphasizes on attractive returns and capital preservation.
They have long been valued for their capital preservation qualities, particularly among high-net worth individuals and other private investment interests.
60%, Nationwide Financial has begun offering owners of certain of its variable annuities Capital Preservation Plus Lifetime income, which guarantees return of principal during the accumulation/preservation period, and then withdrawals for life.
Its risk-averse, capital preservation philosophy weathered the 2000-2002 bear market with a positive return.
The measure also would specifically authorize $4,979,092 from the Garden State Historic Preservation Trust Fund for capital preservation or historic site management grants to be awarded by the New Jersey Historic Trust for projects in northern New Jersey.

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