Answer:
1. Ownership Investments
Ownership investments are the most volatile and profitable class of investment. The following are examples.
Stocks
Owning stock means owning a portion of a company. It may be a miniscule stake, but it's ownership.
More broadly speaking, all traded securities, from futures to currency swaps, are ownership investments. Investors purchase them in order to share in the profits, or because they will increase in value, or both.
Some of these investments, such as stocks, come with the right to a portion of the company's value. Others, such as futures contracts, come with the right to carry out a certain action that will benefit their owners.
2. Let’s face it, starting a business can be expensive. Few entrepreneurs have the cash on hand to get the ball rolling without some outside help. If you’re starting a small business or looking to grow your business, you may seek financing through a traditional loan, a microloan, or cash from your friends and family. You can also seek funding from investors which is why it’s important to understand what investors look for before investing.
Remember that investors are fundamentally different from lenders, and you’ll need to consider that when you decide what kind of funding you want. Lenders give you money and you repay it with interest. Investors give you money in exchange for ownership of part of your business. Their investments may come with restrictions–that you have to get approval for transactions over a certain dollar amount, for example, or that you have to set up an independent Board of Directors. And investors have certain rights, too, which you should discuss with your lawyer before jumping in.
Investors can be a great thing for your business. First, an investor isn’t demanding repayment every month because it’s not a loan. An investor can also be a reliable source for business advice and may have a strong business network that you can draw on. But this isn’t free money – your investors will have certain expectations.
If you do decide that you want to seek funding from investors, how do you draw them in? What is it that makes them decide to put money into a business?
3. As an investor, you have a lot of options for where to put your money. It’s important to weigh types of investments carefully.
Investments are generally bucketed into three major categories: stocks, bonds and cash equivalents. There are many different types of investments within each bucket.
Here are six types of investments you might consider for long-term growth, and what you should know about each. Note: We won’t get into cash equivalents — things like money markets, certificates of deposit or savings accounts — as those types of investment accounts are less about growing your money and more about keeping it safe.
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