We provide training in the investment basics of financial literacy
What is an investment?
In the modern economy, three types of resources are in demand: time, knowledge and money. When we come to work, we give our time and knowledge for money, which we then exchange for the goods we need. But there is another way to get income — investing money. Simply put, investment is a way to increase capital, the essence of which is to give money in exchange for even more of it. This activity is called investing. It is this technique that rich people use to multiply their capital.
If we consider this issue from the point of view of the layman and exclude the topic of investments in the real sector of the economy, then the meaning of investment is reduced to obtaining income from the invested funds. That is, in simple words, investing involves buying an asset in order to make a profit. This is the main difference between it and an ordinary waste of money.
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The main types of investments
What is an investment: in simple words
Many of the existing classifications are difficult to understand and useless to an ordinary person. Therefore, we will consider only the main groups of investments related to private capital. Real investments
They represent direct investments in production and other similar projects.
They are usually expressed in the form:
Purchase of land, production facilities and equipment, payment for construction services and other expenses for the expansion of production. Major repairs and other types of reconstruction. Investments in a ready-made business. Acquisition of patents, licenses, copyrights and other intangible assets.
It should be noted that not every type of investment is fully available to a private investor. Investments in the real sector are just one of such cases. This market is occupied by professionals not only because of the requirements for high qualifications. The assets of some large enterprises can only be sold to legal entities. In some cases, such operations require the approval of regulatory state bodies. Chart of the volume of investments in commercial real estate, in dollar terms
Competent investments in the real sector are characterized by high profitability and low risks. This is due to the possibility of selling off the assets of a bankrupt enterprise and thereby returning their investments in full or in part. Among the disadvantages, we can note low liquidity.
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