Preservation Of Capital refers to the act of protecting the value of an investment from significant declines or losses. It is a key consideration for investors, particularly those who are risk-averse or have a long-term investment horizon.There are a variety of strategies that investors can use to preserve capital, such as diversifying their portfolio across a range of asset classes, investing in low-risk securities, and using stop-loss orders to limit potential losses.Preservation of capital can be particularly important during times of market volatility, when the value of investments may be more prone to fluctuation. By preserving capital, investors can minimize the impact of market downturns on their investment portfolio and reduce the risk of significant losses.It is important for investors to consider the importance of preserving capital when making investment decisions, as it can help protect the value of their investments over the long term.
