In simple language,
In simple language, investment can be defined as the aggregate of assets with the objective of making a profit therefrom in the future. Another way to look at it is as a means of using money in various ways, or better still as the time and effort expended by an individual to make more money. Investments come in different shades; one of such are stocks for instance, which are equity investments that give you a share in a corporation. There are also bonds or fixed income securities which pay interest over a determined period of time. You must know that mutual funds are diverse equity funds that aggregate money from several investors for greater purchasing power. While on the other hand, futures are commitments to buy or sell a particular commodity at a fixed price on a specific date. Options give anyone the license to purchase or sell any stock or bond at a particular price at a particular time. When someone divides his investment between his mutual funds, cash equivalents, bonds and stocks, that’s what is known as allocation of asset. You ought to know everything about any business before you put your investment. Don’t let anyone kid you otherwise — you need lots of knowledge to engage in investment.
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