What Types of Investments Should you Make?

If you are new to investing, it can be hard to know where to start; still, the idea of investing your money and growing your pot without lifting a finger can be very appealing. So, where are the best places to invest your money and make a return in the short or long term? 

Cash and Commodities 

Cash and commodities are a great place to start if you are new to investing or you are highly risk-averse. Cash and commodities markets include things like gold, silver, and crude oil. These commodities tend to be fairly stable, but they don’t have a high return, so should you invest? 

Take gold, for example, people have been investing in gold since time began, and it doesn’t tend to fluctuate much; however, it is a very secure type of long-term investment because all financial institutions are based on gold. Gold also responds to fear, so invest if things are uncertain.     

Bonds and Security

Bonds and security are another way to invest your money long-term with low risk. Bonds are a form of investing in which you lend government money in return for interest or returns in the form of dividends. Bonds are considered a safe investment as there is a low risk of default. 

 If you want to invest in bonds and earn better returns, then consider investing in corporate bonds. Corporate bonds work the same as government bonds, but there is a little more risk because there is a higher chance of a company defaulting. It means there are better returns. 

Investment Funds 

Investment funds include things such as mutual funds, index funds, and exchange-traded funds. These investment funds are essentially a pool of money that is collected from various investors and are then invested into things such as stocks, bonds, and other assets. But these have fees. 

Investment funds are generally operated by investment fund managers that require fees; this means that your returns will be affected by the nature of the investment fund. The return you can expect from investment funds is lower than individual picks, but it is still a solid investment. 

The Stock Market 

The stock market is the center for trading shares and equity in companies; there are two ways you can invest in the stock market, you can invest in the index (this refers to the rising and falling of the stock exchange), or you can invest in individual companies like pulleys

When you invest in individual stocks, you become a shareowner of a company, so when the company makes money, you do as well. Some individual investments also pay dividends, so if the company does well throughout the year, you will receive an annual payment from them.  

Real Estate 

Real estate is an excellent way to earn short tern returns, especially if you are interested in flipping homes and you have some building or trade skills that can keep the costs down. The main drawback to investing in property is the initial cost which can be quite significant. 

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