Daily, our dreams and wishes are renewed, growing like gas flames, and the avenue of realizing them seems so far away. Our wishes surpass our needs and our dreams see our path to actualization a hard one to walk on. Despite this, making wise financial investments gives us the opportunity to catch up with our wishes to bring our dreams to actualization.
What is financial investment?
Financial investment is an asset or property that you buy with your aim being to generate income or profit. In other words, financial investments are about buying mechanisms in order to make extra money.
Types of Financial Investments
In the same way there are various investors with varying angles of interest, investments also come in several ways. Here are the 7 financial investments that can boost your income in 2021:
1. Mutual Funds
This is a type of investment where people collectively invest funds for the reason of securities. At the yielding of such investments, the profits are equitably shared among the investors based on the already signed agreement between them.
A bond is a type of investment that a borrower (usually the government) buys in form of a loan from an investor (individuals and organisations) with a static amount of interest. This is typically used by corporations and government to fund projects and operations.
This has to do with the purchase of shares from companies and organizations in exchange for agreed interest, meaning that stocks are the evidence they let an investor make valid entitlement over a company asset.
4. Real Estate
This form of investment deals with direct buying of marketable and residential properties by investors. Also, an individual can invest indirectly, which is through real estate investment trusts (REITS).
5. Exchange-Traded Funds (ETFs)
While this type of investment has been around for a long time, it is still very significant today. This shares resemblance with mutual funds investment package. Exchange-Traded Funds is well known among investors for the flexibility it offers in trading and effective coverage.
6. Cash Bank Deposits
Dubbed the easiest and safest form of investments, it offers investors with the accurate knowledge of Return on Investment. That is, how much an investor will earn in interest. One disadvantage of this is that your earned interest is kept in a savings account and may not escape inflation.
As the name implies, this type of investment involves buying of valuables like gold, crude oil, silver, agricultural produce, etc. These items are purchased and stored and are resold when the commodity prices increase.
The goal of investment is to make a profit. The investment highlighted above are the major but not limited forms of investments that can boost your net worth in 2021.