To make a good decision about where to invest your money you need to assess the options available. But this is difficult for a retail investor in an industry notorious for jargon, fads and fashions.

Making sense of the jargon and the latest fashions should go some way towards helping investors assess investment products, investment vehicles and the type of fund manager on offer. Investors need to ensure that they get the product and the fund best suited to their needs.

Among investment fashions in favour are style funds, thematic funds, trackers, themed trackers, consensus funds, hedge funds and corporate bonds.

Style Funds: Style investing is divided into two main types - growth investing and value investing. Growth investors buy into companies whose turnover or earnings are growing faster than the overall economy or those of similar companies.

Even if the shares are expensive relative to the underlying value of assets, the investors believe that the ability of the company to grow faster than other companies will drive its share price ahead of the market. Growth stocks tend to outperform the market when an economy is decelerating.

Value investors examine stock lists for companies whose share prices are cheaper (in terms of price-earnings multiples or relative to net asset values) than those of other companies in their sectors. Buying relatively cheap shares can be a good strategy in an accelerating economy, when most companies should benefit from economic expansion.

It is not too difficult to examine stock lists and pick overperformers or companies with low share prices. It is much more difficult to forecast which of the growth or value styles will be profitable in the medium term. This involves anticipating economic cycles.

Investors should look for fund managers that can adjust their approach or switch styles as market conditions change. Some advisers suggest that investors build portfolios that are neutral in style - made up of a balance of growth and value stocks, and fund managers.

Themed Funds: These funds are aimed at investors who want to get into a particular market, sector or region. The theme could be a geographic region, such as emerging markets, a sector, such as technology or pharmaceuticals, or a global macroeconomic theme, such as protection against inflation.

Investing through funds in specialist areas is less risky for a retail investor than picking an individual technology company or geographic region. A fund offers broader exposure - a retail investor may pick the right sector but could invest in the wrong stock within that sector.

Themed funds may be managed on an active or an indexed basis. In actively managed funds, the fund manager moves into and out of companies in anticipation of and/or in response to market conditions. Indexed funds invest in companies in direct proportion to their weightings on the index the fund is tracking. The performance will then track the overall performance of the index (see trackers/themed trackers).

Trackers: Also known as indexed funds, these aim at building a broad-based exposure to a stock market or a number of markets by buying different shares in the proportion in which they are represented on the index/indices the fund is tracking. The fund manager buys into companies represented on the index and sells those that fall out.

A tracker could be based on one index, such as London's FTSE All Share Index, or on a number of different indices.

Trackers are often called passive investment funds because the investment mix will always be decided by the index that is being tracked. Management charges are generally lower than those for actively managed funds. Investors should ensure that their tracker is tracking a broadly based index - if it is too narrow the risk is increased because too many eggs are in one basket.

Themed Trackers: The investor is buying a basket of shares that should offer a broad exposure within the chosen theme. For example, investors who want to invest on the technology-heavy Nasdaq index in New York, without having to decide which individual company or companies to back, can buy a Nasdaq tracker. There are a wide variety of tracker funds, including funds based on telecoms, technology companies, pharmaceuticals, biotechnology and big companies (large capitalisation stocks).

Consensus Funds: Like trackers, the consensus funds launched in the Irish market by Irish Life pick shares in accordance with the weighting of the companies on the index/indices the fund is tracking. In addition, the choice of investments (equities, property, bonds and the geographical mix of equities) in the funds is weighted in line with averaged managed funds. Funds are rebalanced every quarter. The return will be in line with the return in each market in which the fund is invested. The idea is based on a finding that, over time, only about 25 per cent of funds beat the performance of the indices and up to 50 per cent can perform below the index. Consensus funds aim to take the risk of under-performance out of investing and produce an average return. But critics argue that consensus funds will never produce the best performance for investors.

Hedge funds: These funds used to be seen as high-risk/high-reward investments. One of the best-known hedge fund operators was George Soros - his bet against sterling in 1992 eventually forced that currency out of the then European exchange rate system. It is now a huge market with a wide variety of funds and different degrees of risk. Hedge funds can deal in equities, properties, currencies, interest rates, futures, derivatives or almost any tradable commodity.

Hedge funds usually operate by "going short" and using "leverage". Going short means selling something you don't have - a hedge fund will, for example, sell equities it does not own, promising to deliver them to the buyer at a future date. The deal is based on speculation - the fund will sell equities if it believes the equity market is going to fall. Then, when the market falls, it will be able to buy the equities at a lower price and deliver them to the buyer it had already sold them to at a profit.

The hedge fund makes a profit on its "short " deals when the market moves as it expects. But, if the market moves in the opposite direction, the fund can lose heavily - it will have to pay more to buy the equities it has already sold at a lower price.

Leveraging involves borrowing beyond the value of the fund so that it can do bigger deals in the market. Private investors who want to try hedge funds and who have no particular knowledge of the market should try a "fund of funds". This is a fund invested in a number of hedge funds and with the potential to reduce risk through diversifying both the investments and the fund managers involved.

Corporate Bond Funds: These investments - effectively in funds that make loans to companies or corporates - have been promoted as a high-yield alternative to bank deposits. The investors money is advanced to a company in return for a yield or interest and the repayment of their capital at the end of the agreed period. The higher the yield offered the greater the risk in the investment.

Investors should note, however, that neither the income/ yield on the investment or the capital value of the investment is guaranteed. Late last month, the biggest corporate bond fund in the UK, CGU Monthly Income Plus, told investors it was cutting their yield by almost 20 per cent, from 7.8 per cent to 6.3 per cent.

Corporate bonds get more vulnerable as economies slow down and there is an increased risk that companies will not be able to meet promised yield levels and that higher-risk companies could fail.