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Classified in Economy
Written at on English with a size of 3.02 KB.
INVESTMENT
The investment methods that we find currently can be classified in two
groups: short-term methods and long-term methods. //
The short-term investment methods are classified in three different forms.
The first option is the cash investment, this method consists of putting the
money in a savings account even though interest rates are low. Where we
can find the best interests is in online subsidiary banks, while physical
subsidiary banks have lower type of interests. //
The second option is the deposit certificate, which has a little bit higher
performance than the savings accounts, but you are not able to have the
money during a determinate period of time and people know it from the
beginning. If you do want to have access to your money before the
deadline ends, you will be imposed a penalty; the most common deadlines
are 6 months, 1 year, 18 months, 2 years and 5 years, the biggest the
deadline is, the higher the interest rate is. //
The third and last option of this kind of methods is the money market,
assets that afterwards become money are negotiated on it. In this group
we can find Treasury bills, which are the most known and Used, promissory notes or mortgage backed securities. //
To lose the investment made is difficult in short-term investment methods,
that is its main advantage, and it is an important aspect to consider if we
want to invest our money and receive a high accessibility or liquidity. //
However, short-term investment methods has a Disadvantage: the offered performance is very low, but this is what happens When little risk is assumed, you cannot expect important returns. //
Currently, having several options for short-term investment, none of them
offers attractive performances, even though this is the price to be paid if what
you want is a little risk investment and a high availability of the money.