We all have heard the Phrase " Time value of money ". But What about " Time Value of Risk ". How Does Risk linked with an asset moves with TIME ?
Thing with the roller coaster rides, not all roller coasters are made for everybody to try.
So when you are on a dangerous " not usual " roller coaster, you already are prepared to go nuts.
Similarly one should weigh Risk involved when choosing an investment. The Thing here lies with " time in your kitty " you can afford to stay invested in risky assets (i.e if you take a longer tenure a risky investment will make wonder returns). That is why it is told to remain invested in equity funds for at least 5-7 Years. The longer you keep patient there, the more you get the juice out of it.
For a long term target like higher education of children, their marriage, own's retirement planning etc the fund allocates greater amount towards listed growth companies shares.