5 Disadvantages of Long-Term Investments

In this article, we will take a look at the 5 disadvantages of long-term investments. If you want to read our detailed analysis, you can go directly to the 10 Disadvantages of Long-Term Investments.

5. Inflation Risk

While investing in a diversified portfolio can help mitigate the adverse impact of inflation on long-term investments, inflation does affect the purchasing power of money and the value of an investment. Investors must account for changes in the realized real return on investments while making an investment decision. Often, bonds with a fixed coupon rate are at the most risk of being subjected to inflationary pressures.