Investing in stocks involves buying shares of ownership in a company. Investors can benefit from potential capital appreciation and dividend income. Stocks are typically considered higher risk but can offer substantial returns over the long term.
Bonds represent debt securities issued by governments, corporations, or municipalities. Investors lend money to the issuer in exchange for periodic interest payments and the return of the principal amount at maturity. Bonds are generally considered lower risk than stocks.
Real estate investments involve purchasing physical properties, such as residential or commercial real estate, or investing in real estate investment trusts (REITs) that own and manage various real estate properties. Real estate can provide rental income and potential appreciation in property value.
Mutual funds pool money from multiple investors to invest in a diversified portfolio of stocks, bonds, or other securities. They offer diversification and professional management, making them a popular choice for investors looking to spread risk.
