What are asset classes?

In financial terms, an asset class is a specific category of investment such as stocks, bonds, real estate or cash. The main asset classes and the differences between them are explained further in this section.


Equities are also often referred to as 'stocks' or 'shares'.


A bond or fixed interest security is an instrument of debt issued by a company or government, repayable after one year.


Although cash is a financial asset, fund managers do not usually invest in cash as such, other than for short-term treasury management.

Real Estate

Real estate has some features that make it different from other traditional pension fund investments.


Alternative asset classes typically include private equity, hedge funds and commodities. 

Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested