Hello Accelerated Math Students! As part of your Quarter 2 investment project, you will post on this blog using your holiday pseudonym. You will also comment on two other posts. EXTENDED DUE DATE: SUNDAY DECEMBER 11, 2016. The grades are now finished for the blog.
Thursday, December 8, 2016
Basic Types of Investments
Google defines investment as something the action of process of investing money for profit or material result. I was still confused after knowing this definition so I decided to read more into investments. I learned that there are three basic types: ownership, lending, and cash equivalents. Ownership investments are the ones that come to many people's minds first when they hear the word "investment." You are the one spending your own money, hoping for it to grow over the course of time. The second type of investment is lending. This type allows you to play the role of the bank. Despite being safer than ownership, this way earns you less money. You allow others to borrow your money, with the expectation that they will be returning it along with interest and any other fees. The last type is known as cash equivalents. This type of investment can be easily converted back into cash, thus giving it the name, "cash equivalents." These investments have a very small return as the risk is also small.
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I didn't know that their were different types of investment. I learned that these 3 types of investment can be easy to make your money grow. For an example the the second investment "lending" can actually play a role in our lives one day. If a friend borrows money from you, you can charge them with interest. Thank you for the explanation of the basic types of investments.
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