Investment is the process of putting money into something that has the potential to provide you with a financial return. Investing can be used to reach many financial goals, including buying a home, saving for retirement or starting a business. There are a number of different types of investments, from safe choices like high interest savings accounts and term deposits to more adventurous options such as shares and property. It is important to choose an investment that fits your risk tolerance and investing time horizon, as well as your personal preferences.
There are a number of different ways to invest, from do-it-yourself platforms to the option of working with an investment professional. Before committing your resources, it is important to develop a strategy outlining how much you want to invest and what types of returns you are hoping to receive. It is also crucial to understand the risks involved and educate yourself on how the market works. Avoid investing based on hunches or hot tips and always research the companies in which you are investing.
The investment market has evolved considerably over the centuries, with new opportunities emerging as technologies develop and people become wealthier. The industrial revolutions in the 1800s and 20th century helped make it possible for people to save and invest their money, facilitating the growth of the modern finance industry.
Investments can be made in public or private markets, with a range of products available to retail and wholesale investors. When choosing an investment, it is essential to review the product disclosure statement (PDS), which will provide you with key information about the investment, including the expected returns, fees and charges, and the legal and tax implications.