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Types of Investments Entrepreneurs Should Know About

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Types of Investments Entrepreneurs Should Know About

Investing is an important part of achieving financial independence. In case you plan to retire at some point, investing is something you simply can’t succeed without. If you never did it before, putting your money into something can be scary. Finding the best way to start is the key success, but before you do it, you need to know what types of investments there are. With that said, let’s talk about a few types you simply have to know about.

 

Real estate investments

There are numerous reasons why many investors put their money into real estate. Investing in real estate is considered to be growth investment as the price of property can substantially increase over time. The best part of it is that there are many ways your property investments can make you money. For example, you can rent a house or an apartment until its price increases, and you sell it. Just remember that this requires you to act as a landlord. Another great way to make money investing in real estate is to flip it. All you need to do is buy property, remodel it, and sell it for profit. Property can fall in value, and it carries the risk of losses, but it’s a risk worth taking.

 

Types of Investments Entrepreneurs Should Know About

 

Corporate bonds

Loaning your money to a large firm can do wonders for your portfolio. Basically, you give the company money to work with, and it pays you back with interest. You can buy these bonds through mutual funds or ETFs. What makes corporate bonds different from government bonds (another popular type of investment) is that the rates are much better. The problem is, corporate bonds also come with more risk. This is mostly because if the company goes under, you don’t get all of your money back. If you opt for corporate bonds, keep a close eye on macroeconomic factors. The last thing you want to do is buy corporate bonds just before their prices collapse.

 

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Gold and other precious metals

Throughout history, gold has always been and remains one of the most popular investment options. Today, investors buy gold mostly to diversify their portfolios. This is because no matter what direction the economy goes in, gold retains its value. The same goes for other precious metals such as silver and platinum. Also, gold and other metals often rise in value, and you can even sell them for profit. The most popular way of obtaining these metals includes buying coins and bullion. If you decide to diversify your portfolio with gold or any other precious metal, you’ll also need a place to store it. Luckily, there are experts who can do this for you and keep your investments safe.

 

Common stock

When you think about investing, probably the first thing that comes to your mind is stocks. It is arguably the best and more popular investment option for the average investor. A portfolio comprising of diverse common stocks can do amazingly well. What’s so great about buying stocks is that you can now do everything from the comfort of your home. As long as you have a broker, you can trust, all you need to do is log into your account and find stocks worth investing in. Therefore, finding the best stock brokers you can turn to is extremely important when starting out. Another good idea is to play with a stock simulator before you invest real money.

 

Types of Investments Entrepreneurs Should Know About

Angel investments

There are startups with great potential out there. However, most of them don’t have the money to reach it. They usually rely on investors who can help them financially. One of the most common types of investors they turn to is angel investors. To become an angel investor, you need to have a keen eye for businesses that have a bright future. You can then finance their operations and get your money back with interest. Another common feature of angel investors is that they know how to run a business. If this is the case with you, you can use both your money and expertise to help the business grow and maximize your profit.

 

Fine art

Art isn’t necessarily what some investors have in mind when starting out but putting money into it makes a lot of sense. In the last few years, we saw the prices of quality art pieces increase every year, and selling them for profit is a great idea. Not only this, but art is one of the few investment options you can showcase in your home. Just like some other types of investments, you need to possess a certain amount of knowledge before you start buying fine art pieces. If you’re into art, it shouldn’t take you long to recognize pieces that are worth investing in. Just remember that storing and maintaining art correctly is a must if you plan to sell it for profit.

 

The bottom line

If you’re a beginner investor, it’s important to find the types of investments that best suit your skills and needs. Consider the options covered in this post, and you’ll have nothing to worry about.

 

 

Read more Business related articles in The Weekly Trends magazine.

Jessie Connor is a passionate writer and researcher from Brisbane, contributor at several business and lifestyle blogs, hooked on yoga and healthy living. She loves to spend her free time travelling, reading and of course – shopping!

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