Lets begin our investment basics lesson from where we left. Lets move on to the next 4 types of investments.
Mutual Funds:
In this process you select a professional manager (or comapny)to whom you have to pay and he (or the company)on bahalf of you would invest your money in stocks, bonds and indexed mutual funds based on your scheme. Depending upon the performace of the entities in which your money has been invested, you would receive a return.
Derivatives:
These can be defined as financial contracts whose value can be determined from the values of assets such as bonds,equities etc on which they are invested. They exist in the form of swaps, options and futures.These are used to minimize the effects of loss that occur due to fluctuations in the value of underlying assets( hedging).
Real Estate:
This is a long trem investment. The retsurns are based on the income aquired through rent, lease or sometimes even capital appreciation.Residential or even commercial properties come under this category.
Commodities:
This involves investing in commodities such as agricultural (cattle, corn etc) or in crude oil, gas or gold. The most popular way to invest in commodities is through future contracts. To know more about investing in commodities, you could visit various websites that offer all information one needs to know before investing. All you have to do is perform few searches.
So this is all we have on types of investments but i assure that i am going to be back with lot of information on basics of investment.
