Which investing principle is applicable for an aggressive investment profile?

The investing principle that aligns with an aggressive investment profile is horizon matching. This approach emphasizes aligning the investment strategy with the investor's time horizon, which is often long-term for aggressive investors. Individuals with an aggressive profile typically seek higher returns and are willing to endure higher levels of risk. By matching investments to a longer time frame, they can ride out market volatility and take advantage of the growth potential that usually accompanies equities and other high-risk assets.

Aggressive investors often choose growth-oriented investments rather than those focused on income generation or capital preservation. While income generation might be attractive for other profiles, aggressive investors prioritize maximizing capital appreciation, especially when they have a sufficient time horizon to recover from potential fluctuations in the market. Similarly, risk aversion and capital preservation are typically more aligned with conservative or moderate investment profiles, which seek to avoid significant losses and prioritize safeguarding their investment.

In conclusion, horizon matching allows aggressive investors to pursue their investment goals effectively by leveraging time as a critical factor in managing risk and optimizing returns.