Different Types of Investment You can make
There are many different types of investment that you can make, and what you do invest in is often a matter of your personal requirements and preferences. Each type of investment will have its own pros and cons and might appeal, or not appeal, to different types of people. Here are some of the more common forms of investment and some of the pros and cons associated with them.
Many of us will end up investing in property at some point in our lives, and mortgages are fairly easy to come by for those in full time work. For most of us that do buy a house, it is often more to have a home of our own than for any financial gain, but for others it is all about the money. Some people will buy in order to then rent out the property at a profit. Others will buy in the hope of being able to sell at a profit in the future. Property is generally seen as long term investments for individuals, although property developers might look to make short to mid-term gains. Property is generally a fairly secure investment, although there is a risk of property market crashes.
Whether it is your own business, or you are helping to finance somebody else’s, investing directly into a company is another popular form of investment. The hope is generally that with investment the business can grow and the investor can then profit from the revenues that are generated, or by selling the business on. Making a business a success is not easy and requires hard work and new businesses do often fail, so there is a risk of losing your investment. Get it right though and you could stand to make a lot of money.
Investing in stocks is perhaps a stereo-typical form of investment and it leads to images of wealthy entrepreneurs and well-heeled bankers. Many stock investments are geared more toward long-term financial security rather than striking it rich, however. A typical portfolio with a stock-broker will include stocks for companies that are expected to increase steadily in value of the years without massive increases, but will still see better returns than the interest you are likely to see from your bank account. Some stock investments in new, upcoming companies can give the chance of making it rich, but come with a high risk of losing all your investment.
Options and Futures.
Do you remember the movie trading places where people made and lost millions overnight? Well this was based upon the options and futures market. If you want the chance to become filthy rich overnight then the options and futures market could well interest you. Massive gains can be made on relatively small investments, leading to profits that will change your life forever. Of course though, there is a catch, the catch being that if things do not go your way then you could potentially also lose everything overnight. With the high risks involved, the options and futures markets is normally only traded in by the experts.