Surely many savers have wondered on occasion, how to invest my money? , since they have seen how after the crisis, interest rates have fallen, leading to the fact that the profitability they obtained for their capital has decreased dramatically.
On the one hand, we find the classic financial products in which to invest the money. Among them are those offered by banks, the stock market or real estate investments.
On the other hand, in recent years, crowdlending platforms have begun to take center stage, which speed up the process of investment operations and can be done from home. In short, these are financing / investment platforms to invest in, which have an attractive return, thus constituting them as a powerful investment alternative.
Before deciding on what to invest my money …
In this simple infographic we show you what to do:
Study the different investment alternatives
The first thing you should do before deciding on what to invest money, is to obtain information on the different alternatives that are currently available to invest in the market, so you can know the main characteristics of each of them. Value the profitability you want to get but don’t forget the risk you are willing to take.
Choose what to invest based on your preferences
Once you have assessed the different alternatives in which to invest the money, it is time to decide which one best suits your preferences … This choice varies depending on the economic objective you pursue, risk aversion and personal factors .
Final decision: what to invest in?
After assessing the possibilities in which to invest the money, the final decision of the financial product is made. You must decide the amount you are going to allocate to the investment and always take into account the diversification of your portfolio. To avoid a higher percentage of risk, it is good that you invest in different products so that, in case of late payment, it affects your portfolio as little as possible.
What to invest my money in ?: Financial products
Next, we show you the different options you have when deciding on what to invest the money.
What to invest in traditional banking
- Bank deposits or savings accounts : This alternative is one of the most traditional, does not involve any risk, so it is an option to invest the money if security and willingness to expire are sought. These deposits are usually fixed term.
- Investment funds: These are savings instruments formed by a group of investors that join their capitals where a management company is responsible for investing it in order to obtain higher returns. Let’s not forget that these societies assume a high degree of risk.
What to invest in stock markets
There are different stock markets in which to invest your money in which each one presents different financial products with different values. They are basically based on financial transactions. The different stock markets that exist in which to invest are:
1. Primary Market: In it, two products with different values are placed:
- Fixed income, where interest payment and capital repayment are guaranteed.
- Equity , where the actions whose return is not known until the results of the company are known.
2. Secondary market: Commonly known as a second-hand or resale market. In it, you invest in products previously placed in the primary market in order to renegotiate.
3. Stock Market: Generally transactions are carried out with assets of a similar nature. The quintessential products traded in this type of market are stocks, public or private bonds … The Stock Exchange is framed in this market and is a classic way to invest your money.
4. Over-the-counter market: Basically, it is an unorganized market in which financial instruments are traded outside formal markets.