Nowadays, a lot of people still confuse financial investments with their accumulation or saving. And this despite the characteristics, have critical differences between these concepts. You can save money and save it somewhere for a "rainy day." In the bank, under the mattress, it does not matter where, because one day inflation will do its job, and this money will lose its original value or completely depreciate. Investments allow not only not to lose money, but also to also make money.
Investments - the investment of financial resources in various projects for future benefits.
The essence of investing is extremely simple. A person has a certain amount of money (or some valuable assets), he can entrust it to a financial company for a certain period of time, which will invest it in some project, sometimes even of his choice. When the deadline expires, the funds will be returned to the owner along with the interest paid on the use of this invested money. Of course, there are risks here, therefore the choice of the company to which the funds will be given and the project in which it will invest them is especially critical.
With investments, the concept of risk goes beyond the mere loss of money. By investing in something, the investor hopes to get a certain result. And even the discrepancy between the final result and the desired one can already be considered an unsuccessful investment. As a rule, risks are proportional to the potential return on investment. This is especially true for investing in securities.
Since there are several types of investments, depending on which one, risks are usually divided into several types:
These are not the only possible risks, but the largest and most common. You can usually adapt to risks and learn to avoid them, but there are several ways to reduce them.
Of course, one of the most important questions of a potential investor: where to invest? There are many investment options, and every year there are more. Structuring them is not so simple, but a certain selection of the main options can be done.
As the saying goes, the choice is yours. You only need to be careful in choosing and remember the risks.
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