Investment Options That Can Produce Additional Income
Investing is a great way to stack your coins and build wealth. Several investments can help you to accumulate money over some time. Some high-risk investments are more volatile than others. Regarding investing, volatility means that your investments are liable to change rapidly and unpredictably. Volatility is a significant risk factor to examine before purchasing any investment option. Before you start your investing journey, be sure to extensively research your options or seek professional advice.
High-risk investments are a great way to make your money work for you and potentially earn a nice profit. Two examples of high-risk investments are:
The Stock Market
The stock market is one of the most powerful wealth-building tools, and it is joined with significant risks and reward factors. There are three major stock indexes, which are: the Dow Jones Industrial Average, S&P 500, and the Nasdaq Composite. The stock market is where investors buy and sell a stock in hopes of gaining a profit. Companies offer a piece of their company, called shares, to let investors purchase a stake in their company. Individual companies also offer dividend payouts, which are regular payments that companies pay their shareholders for investing in their company. Keep in mind that stocks are not FDIC-insured, meaning you can lose your principal investment and any additional profit that you may earn.
Real Estate Investment Trusts, also known as REITs, can be a great way to invest in real estate without owning or managing a property. You can invest in publicly traded REITs on the stock market or through a brokerage account. If you are considering investing in REITs, be sure you are knowledgeable about the risks and rewards that REITs can offer.
Many types of REITs are separated into two independent categories. The first category that separates REITs is by investment holdings, and the second is by trading status. There are three types of REITs classified by investment holdings: Equity REITs, Mortgage REITs, and Hybrid REITs. The types of REITs sorted by trading status are publicly-traded REITs, public non-traded REITs, and Private REITs.
There are so many ways to invest your money, but before you start investing your money, make sure your financial goals align with your investment options.
What high-risk investments are you investing in? Comment below, we’d like to hear your thoughts.
Here are two low-risk investments, that can help grow your money.