There are numerous investment options available today. Investment refers to purchase of an item, either bonds, stocks, real estate, forex or art and jewelry with expectations that they will appreciate and be sold at a higher price to generate income. Investment entails buying and holding to wait for the item to appreciate in value. It is different from trading which entails buying and selling assets at a very high frequency. Generally, investments are less risky and less complex compared to trading.
Some of the investment options available are:
Real Estate Investment.
Real estate investment has become popular among investors in the past fifty years. It has many opportunities for making tremendous profits. Lucrative as it seems, investing in real estate is not as simple as investing in the stock market.
It involves purchase of a property, say offices or residential units, renting it out and maintaining it. In picking up property, consider the vacancy rates in the area the property is located. This is important in making sure there are no periods in which you run short of tenants, causing you to have negative monthly cash flows and a hard time in covering your mortgage payments.
You can also use real investment groups which are more like small mutual funds. This will save you the hassle of being a landlord and having to maintain the property.
Diamonds hold more value than any other traded element in the world. Its value is inherent and stable, that is, it is not affected by currency fluctuations, bank crises and stock market variations. Their value also keeps appreciating. They have a remarkable return on investment and sales are not subject to statutory reporting requirements.
This is also called the currency market. It is the world’s largest financial market and is comprised of banks, commercial companies, central banks, investment firms, hedge funds and retail investors. You can buy, sell, exchange and speculate currencies.
Forex is a market where currencies are traded in pairs. As an investor, you are essentially betting that one currency will rise and the value of the other will fall and it is from this differences that you will make profit. Currencies are bought and sold as per the current exchange rates.
This is a new but widely recognized method of trading. It basically involves trading on the price movement of the underlying asset, deciding if it will rise or fall. Assets that have binary options include stock, currency pairs, indices and commodities. If you are serious about investing in binary options, you should learn about them and how they work, sign up with a recommended broker, ask to use their demo system before trading with your own cash and use strategies, read up on your assets and watch for factors that may affect its price.
Money Market Investments
They have low risk to principle. It is possible but unlikely to lose money in a money market investment. If interest rates go down below the inflation rate, the money market investment loses buying power. It has a modest rate of return as a result of conservative investment strategy in short term debt obligations.
Exchange Traded Fund
ETF is a security that tracks an index, a commodity or assets but trades like a stock on an exchange. Its net asset value is not calculated every day since its prices changes throughout the day as they are bought and sold. Its expense ratio is lower than that of average mutual fund.
A stock market is a market platform in which shares of publicly held companies are issued and traded through exchanges or over the counter markets. It provides companies with access to capital in exchange for a fraction of ownership in the company. When companies are profitable, stock market investors make money through dividends.