Types of Investment

Types of Investment 

As we mentioned in a previous article, investing simply means making your money grow over time. The fundamental idea is that you expect your money to return to you with interest or an increase in its value. There are a vast array of assets in which you can invest your money to achieve this growth. 

In our modern era, investing is often associated with financial instruments that help individuals and companies raise and distribute funds to other businesses. These companies, in turn, use these funds to grow their operations or generate profits. 

Common Types of Investments: 

• Stocks (Equities): When you buy a share in a company, you become a part-owner of that entity. Stockholders are called shareholders. They can benefit from the company’s growth and success through an increase in the stock price and by receiving regular dividends from the company’s profits. 

• Bonds: These are essentially loans you provide to entities such as governments or corporations. When you buy a bond, you own a portion of that entity’s debt and are entitled to receive regular interest payments and the return of the bond’s original value upon its maturity date. 

• Funds: These are investment vehicles that pool money from many investors and are managed by professionals. They allow you to invest in various types of assets, such as stocks, bonds, commodities, and more. Popular types include mutual funds and exchange-traded funds (ETFs). ETFs are similar to stocks in that you can buy and sell them on an exchange, and their price changes continuously throughout the day, whereas mutual funds are traded and valued only once at the end of the day. Both types of funds can track the performance of well-known market indices, such as the S&P 500 or the Dow Jones Industrial Average, or be actively managed by specialized managers to achieve better performance. 

• Real Estate Investment Trusts (REITs): These are another type of fund that pools money to invest in commercial or residential real estate. These trusts pay regular dividends to investors from the rents they collect. A key advantage is that they are traded on stock exchanges, making it easier to buy and sell your shares. 

• Alternative Investments: This is a comprehensive category that includes hedge funds and private equity. Hedge funds are named as such because they can limit the risk of their investments (hedge) through long-term or short-term investing in stocks and other investments. Private equity enables companies to raise capital without offering their shares to the public. Historically, hedge funds and private equity were typically only available to wealthy investors considered “accredited investors” who met specific income and net worth requirements. However, in recent years, alternative investments have been offered in fund formats accessible to individual investors. 

• Options and Other Derivatives: These are financial instruments whose value is derived from other assets, such as stocks or indices. Options contracts are a common example. These instruments often utilize “leverage,” meaning they can generate high profits but also involve significant risks. 

• Commodities: These include items like metals, oil, and grains. You can trade them through commodity futures contracts, which are agreements to buy or sell a specified quantity of a commodity at a set price on a specific future date, or through exchange-traded funds. They are used to hedge against risks or for speculation. 

Risk Levels: 

Risk levels vary among different types of investments. Basic investments like certificates of deposit are considered the least risky, followed by bonds, with stocks being riskier. Commodities and derivatives are generally considered the riskiest. 

Return on Investment: 

The return you receive depends on the type of asset you have invested in. For example, stocks distribute dividends quarterly, while bonds pay interest periodically, often every three months. 

naqdi and Investing: 

naqdi platform provides you with access to a wide range of investment opportunities in global financial markets. Whether you are a novice or an experienced investor, we offer you the tools and knowledge necessary to achieve your financial goals. 

What Can You Trade with naqdi? 

• Global Stocks and Indices: naqdi offers you the opportunity to invest your funds in leading major companies, in addition to providing you with real-time analyses and insights into the performance of important global markets, such as the S&P 500, Dow Jones, and Nasdaq. It also enables you to become part of the growth of leading companies like Apple, Tesla, and Google by owning a stake in them. 

• Forex (Foreign Exchange): naqdi also helps you capitalize on fluctuations in currency exchange rates and changes in global interest rates by trading major, minor, and exotic currency pairs from around the world. 

• Commodities: With naqdi, you can diversify your investment portfolio and hedge against the risks of inflation and market volatility by trading a variety of essential commodities, including oil (of various types such as Brent crude), natural gas, precious metals like gold and silver, as well as vital agricultural products like coffee. 

• Exchange-Traded Funds (ETFs): naqdi provides you with an effective way to diversify your investments efficiently and easily by trading ETFs that track the performance of specific economic sectors or broad market indices. 

• Digital Currencies: naqdi allows you to be part of the financial evolution by investing in the rapidly growing digital currency market. 

Begin your investment journey with naqdi today and enjoy diverse trading opportunities in global markets!