Whether you are completely new to the investing game or you have an extensive portfolio of fantastic investments, it is always important to keep on top of what exactly these financial investments are doing for you. With a wide variety of financial investments on offer, it can sometimes be tricky or confusing to understand exactly how it all works. One of the best places to start is to understand what different types of financial investments there are and how they can work for you.
Shares
Whether you have been investing for years or you are currently planning your very first investment, you will have heard the term ‘shares’. Shares are popular investments for a lot of people as they can help you grow your investment over the medium to long term. Shares vary in value, as they rise and fall constantly depending on a variety of factors such as what is currently happening in the world and how the company’s value is perceived at a moment in time. With this in mind, it is important to remember that sometimes, the value of your shares can end up lower than what you originally paid for them, however, it can also end up higher. This is why shares are sometimes seen as a riskier investment.
Commercial property syndicates
If you are interested in investing in commercial property, you may have come across commercial property syndicates. These investments work by pooling together money from a variety of investors who are looking to invest in the same sort of property, for example, industrial, commercial or retail. By pooling together funds from multiple investors, the group can invest in larger properties, potentially offering a higher return from their investment. Commercial property syndicates are popular among people looking to invest in big properties such as shopping centres and office buildings that they could not necessarily afford to buy on their own.
Property
Some people may prefer to invest in their own properties rather than participating in something like a commercial property syndicate, so they can have more control over their investment. This is a popular growth investment for a lot of people, as property can rise in value over time. However, it is important to remember that similar to shares, property investments also have the potential to decrease in value.
Mutual funds
Similar to commercial property syndicates, mutual funds work by having multiple investors pool their investment funds together, however, they use it to invest in companies. Mutual funds invest in a number of companies, with a specific focus on choosing investments that will increase in value for the investors. If you are looking for an investment that does not involve too much of your own time, this is a great option because these funds can be managed actively or passively, usually by a fund manager who strategically chooses companies to invest in on your behalf. Although mutual funds may have similar risks to stocks, they are usually seen as less risky, as these investments are placed in a diverse range of companies.
