Anyone who has ever started investing will sooner or later ask themselves the question: "And have I spread it correctly?" You'll find the answer precisely in an investment strategy. We'll show you what a conservative, balanced and sustainable investment strategy all involves – and why you really don't need to be afraid to start.
What is an investment strategy and why it matters
An investment strategy is your game plan. It determines how to invest money, which investment instruments to choose and with what goal. It helps you stay on course even in turbulent times and gives you peace of mind that you are investing thoughtfully, not impulsively.
There are various kinds of strategies – and we'll talk about some of them today. If you're interested in how to start investing, read the basics of investing.
Categorisation of investment strategies
Investment strategies can be viewed from several angles. We'll take a more detailed look at 5 approaches (plus one additional, uncategorised investment strategy). These are not five separate layers, but two different ones that complement each other. So you can quite easily have a long-term conservative strategy as well as a short-term dynamic one. It depends on your goals, your willingness to take risks and the time frame in which you want to grow your money.
Dividing investment strategies by the level of risk
1. Conservative investment strategy
A conservative strategy is suitable for those who prefer stable returns and low risk. The price for stability, however, tends to be lower returns.
Typical instruments are government bonds or savings accounts.
When it's suitable:
- Before retirement
- If you don't like risk
- If you're investing for a shorter period
Reading tip: Saving for retirement: How, where and how much
2. Balanced investment strategy
A balanced investment strategy combines return and security. It is usually a mix of conservative and dynamic instruments, such as ETFs, real estate and a smaller share of stocks.
Who it's ideal for:
- Investors with a medium risk appetite
- Those who want growth but at the same time don't want to lose half their investment overnight
- Long-term as well as medium-term investors
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3. Dynamic strategy
This strategy represents a kind of bridge between a balanced approach and aggressive trading. You still stick to a long-term horizon, but you're no longer afraid of more significant volatility – especially with stocks or cryptocurrencies.
A dynamic approach can be surprisingly calm if you go about it smartly – for example, using the DCA method (regular investments into the same asset, for example into cryptocurrencies). Compared with the aggressive strategy, which we'll cover in the very next point, it is more passive.
Advantages:
- You can manage it passively (e.g. through regular purchases of ETFs or cryptocurrencies)
- You take advantage of the potential for higher returns
- It's more time-efficient than the aggressive style
Who it's ideal for:
- Those who want a bit more than the "golden middle way"
- Investors with a long horizon and an interest in markets
- Anyone who doesn't want to watch charts every day, but at the same time isn't indifferent to what's in their portfolio
4. Aggressive strategy
If you decide on an aggressive investment strategy, count on a big investment of time – not only in education, but also in frequent trading, in trying to time the market at the right moment, or in maximising profit through leverage.
We're talking here about stock picking (that is, selecting individual stocks instead of index funds), about cryptocurrencies, leveraged instruments, CFDs or various certificates.
It is only suitable for bolder natures. This path is, after all, very volatile and doesn't suit everyone.
Who it's ideal for:
- Those who actively deal with investing
- More experienced investors with an interest in markets and the time capacity
- People who don't mind larger fluctuations or deeper declines
Dividing by the length of the investment horizon
1. Short-term investment strategy
A short-term investment strategy is ideal if you know that you'll need the money in 2–3 years. It aims to take advantage of short-term market fluctuations, e.g. through stocks, ETFs or P2P loans. Term deposits and some bonds also belong here.
Be careful, though:
- Short-term strategies are often less profitable
- Fees and taxes will significantly affect you
2.Long-term investment strategy
A long-term investment strategy aims for stable growth of wealth over time – usually over a horizon of several years up to a few decades. It uses the power of compound interest and brings high growth potential.
The key advantage is the use of compound interest and lower sensitivity to short-term market fluctuations. A long-term strategy is ideal for building retirement capital or securing financial independence. It carries less risk and is suitable even for beginners.
Typical instruments:
- Stocks and ETFs
- Real estate investments (e.g. in the form of crowd-owning)
- Pension funds
At InvestBay we usually hold properties for several years and then sell them at a profit – investors obtain a return from rentals as well as from the sale. Find out more about how it works.
Sustainable investment strategy: When you want to earn and help
A sustainable investment strategy (so-called ESG) takes into account not only financial returns, but also the impacts on the environment, society and corporate governance. Investing in ESG projects is a way to grow money while at the same time supporting companies that behave responsibly.
Whether the return is key for you, or you also care about where your money goes, ESG gives you a choice.
How do you recognise it?
- Investing in projects with a low carbon footprint
- Choosing companies that treat their employees and communities well
- An emphasis on transparency and ethics
What's important, though, is:
There is no universal answer as to whether ESG investments bring higher or lower returns. Some investors believe that companies with a quality approach to ESG have a greater chance of long-term success. Others see this approach more as a conscious choice – and even though it may mean a lower return, they consider it the right direction.
How to choose the right investment strategy?
Ask yourself:
- What is my investment horizon?
- How much am I willing to risk?
- Do I need access to the money at any time, or do I not mind "locking it up"?
- Do I track the performance of my investments actively, or do I want peace and quiet?
How InvestBay helps you with your investment strategy
InvestBay is a Czech investment platform that enables crowd-owning – that is, the co-ownership of profitable properties. You invest online from as little as CZK 2,500 and obtain a share of the rental income as well as the sale of the properties without the worries of tenants, maintenance or taxes.
3 main advantages of InvestBay:
- Regular rental income and profit from the sale
- A transparent approach and verified projects
- A Czech company, Czech legislation, easy communication
InvestBay is an ideal tool for anyone looking for a smart yet accessible investment strategy. Thanks to micro-investments in real estate you can invest from as little as CZK 2,500, even without experience or complicated paperwork.
The unique crowd-owning model represents a balanced investment strategy in practice – you combine regular rental income with profit from selling the property.
What's more, InvestBay enables so-called "diversification within diversification" – not only do you spread the risk by investing in multiple properties, but you can also spread them across different countries and market conditions.
And so that you have a clear idea of how much you'll earn, you can easily calculate the return with our investment calculator.
Frequently asked questions
1. Is an investment strategy the same thing as an investment portfolio?
No. The strategy is the plan, the portfolio is the specific allocation of assets according to this strategy.
2. Can the strategy be changed over time?
Yes, and it's even desirable – depending on how your goals and life situation change.
3. Can different types of strategies be combined?
Definitely. You can have, for example, a conservative part of your portfolio for short-term goals and a dynamic part for long-term growth.
4. How often should I reassess my strategy?
Ideally once a year or upon a significant life change (e.g. the birth of a child, buying a house, etc.).
Sources used:
Gratton, P. (2025, January 21). 5 Key Investment Strategies To Learn Before Trading. Investopedia. https://www.investopedia.com/investing/investing-strategies/
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