Investments - what is it? Investments in business or real estate. Types of investments

Investing is the process of investing funds (capital) in order to profit in the form of profit. Are investments safe? That it is safe, difficult to talk about, compare them with lending.

Comparison with lending

The difference between investing and lending is that in the latter case we know that the money will return to us with a certain percentage on time, but we can not talk about investments. The fact is that this is a risky activity, the profit depends on the success of a project, in case of an unsuccessful investment, a complete or partial loss of the invested capital is possible.

Investments - what is it?

Let's think logically what you need to do in order to make money. Many for this purpose find work and spend there their time and energy, receiving wages. In such a situation, what do you need to do in order to get more? It is logical, that for this purpose it is necessary to work more (qualitatively or quantitatively). Thus, a lot of time is spent on work, and human forces always have a limit. If you work constantly, then there will be no time for rest, and improving your financial condition will cease to make sense. In this situation, investments come to the rescue. That this is a wonderful way to make money work for yourself, and not vice versa, there is no doubt about it. Truth is said, laziness is the engine of progress. It does not need much and work hard. While you are engaged in your home affairs, deceiving the law of physics, which says that one body can not be in two different places at the same time, you can still earn, though not quite you, but "deputy" - invested capital. A little understood the meaning of the word "investment". What is this, now we know, because we can pay attention to the main point, namely - where, in fact, to invest money.

Types of investments

You need to invest money in something. In the world there are a huge number of options where people invest savings. Now popular funds, bonds, shares, very profitable investment in real estate. This is only a small part of where you can invest. And if you are well versed in something, then an investment business can be a great option. It's not about where you'll invest, the main thing is that it's profitable. Money should work for you.

Promotions

A share is a variety of securities, certifies the right to share its owner (shareholder) in the ownership of the company and gives the opportunity to manage it and receive dividends (income).

Bonds

The bond fixes the company's debt obligations to the owner of the paper. A bondholder, unlike a shareholder, does not manage the company and does not have the right to receive dividends from its profits. The owners of this security are paid interest income, and at the end of its circulation or at maturity, a nominal value is issued.

Risk Comparison

Shares are more risky investments than bonds, since dividends depend only on the successful development of the company. Bonds are secured by the asset and property of the enterprise.

Investment funds

For a simpler understanding of the topic, we will present funds in the form of a sack of money, which is filled from legal or private persons. Capital investments are transferred to the trust management of the bank, which manages the process of investing in bonds or shares. Investors themselves can not invest directly because of the complexity of the work and the high cost of the purchase and sale procedure. I would like to note that these are rather long-term deposits, despite the fact that the investor can withdraw money at any time. Profit usually you receive no earlier than 2 years, also do not forget that this business is risky, and in the end it is possible and completely lose their savings.

Is it worth investing in a business?

In order to answer the question, you need to understand that when investing in business, you get a certain percentage of its profits. It is also worth noting that you can invest in your own business as well as in someone else's business. Thus, even if you do not have any ideas to open your business, you can invest in someone else's. Money can be invested as already in a ready business, and make investments in business projects. These are so-called start-ups. The funds invested in such projects are venture investments. What it is? The so-called means are invested in young risky projects, usually banks refuse to cooperate with them, therefore private investors are attracted. Usually the process is characterized by long-term investments in the company. Income generation may also be different. Some investors receive only passive income (interest from profits), others - active (directly run the business). Do not worry if you do not have the full amount to contribute to the business, because you can give not 100%, but for example, 20-30% and join other investors (equity participation). In general, 100% investing in a business is a very risky business, it's much safer to share equity. Investments in business have both a number of advantages and disadvantages.

Benefits

1. A lot of forms and types of business, in which you can invest.
2. There are projects that do not require large funds, as well as equity participation.
3. It is clear and accessible to almost everyone.
4. This is a tangible asset, the tangibility of the invested money.
5. You can take a personal part in building the case, know exactly where and how the funds are spent. Ability to control attachments.
6. Unlimited profitability.

disadvantages

1. The risk of losing capital if the business "burns out."
2. We must constantly ensure that the law is not violated.
3. There may be disagreements with partners (with a shared business building).
4. It is necessary to understand the specifics of the case in which you invested.
5. When investing in a startup, most likely, the profit will not immediately. That is, this type of investment can be attributed to long-term.

The property

Perhaps, this is one of the safest types of investments. Real estate never falls in price, every year it only becomes more expensive. Investments in real estate have a significant disadvantage, which consists in the fact that it is necessary to have immediately an impressive start-up capital. But now you can find another way out of this situation, for example, take a mortgage for construction or a loan, and after the apartment is built, its value will increase in price. It is also beneficial to build and resale garages. Do not forget to take into account the specifics of the market in your region. Also it is possible to rent both habitation and garages. In this case, it is necessary to take into account the location of the object, from which the revenues will depend. If you decide to invest money in this type of investment, then carefully study the legislation, this will help in deciding on the profitability of the project. Investing in real estate is the best way of investing money.

We hope that the article helped to sort out a little the complicated world of investments, and most importantly, made it clear that they can be a means of obtaining additional, and sometimes even basic, earnings. It does not matter which type of investment you choose for yourself, the main thing is to learn how to make money work for you, and not vice versa. Successful, reliable and profitable investments.