Last week we talked about the different types of investment accounts, and the advantages of each. This week we’re covering what goes in those accounts – different types of investments themselves.
Stocks – shares in a single company like Apple, Amazon, or Exxon
Bonds – Loans from an investor to a company, municipality, etc. Commonly referred to as “Fixed Income” since most earn a fixed rate of return
Mutual Funds – Professionally managed investment funds that invest in multiple stocks, bonds, etc. Investors buy and sell shares in the funds directly.
Exchange Traded Funds (ETF) – Similar to Mutual Funds but traded on a public exchange at market prices.
Index Funds – a specific type of ETF or Mutual Fund designed to allow you to invest in an entire stock index (like the S&P 500, or Dow Jones Industrial Average) by buying a single security.
Other – Real Estate, Commodities, Art, Etc. If something gains value over time and has a market for buying and selling it can be an investment.
These are just some of the most common public investments available to you. If you have questions about others let us know at firstname.lastname@example.org or chat with a coach!