Know which investments can give highest return, low risk for long term or high risk types of investments for short term.
Want to know which investments can give highest return? Learn the investment types that can give highest interest or can give you the highest return on investment. Is it stocks, mutual funds, bonds, time deposits, real estate investment or business enterprises? A reader of InvestmentTotal.com asked me a question about the types of investments that can give highest yields. Now I will answer this question based on my own investing experiences.
Anyone who wants to start investing should know not only the risk involved in investing but also the ROI he can get in a specific period of time. ROI or return on investment is very important to know so that you will decide whether you will pull out your invested capital or do the compounding. ROI is one of the things you should consider in your exit strategy. Example, if you invest $1,000,000 and want to double it after 5 years, then you should know the exact annual yields required of your investment.
High Risk Investments Means High Return
Sometimes even high risk investments can’t give you the highest return you are expecting. Due to risk involved, you have to make a careful investment plan and a wise decision on where to put your money. Invest your money according to your financial goal, that’s why it is important to know your retirement target earning asset. Simply means you will invest because you want to have enough money to work for you.
The earning of your investment will use for the cost of your lifestyle you want when you retire. That’s why you don’t only focus on investments that can give you the highest return on investment but choose the type of investment that can help you acquire your target earning asset during retirement.
Investments Can Give Highest Return
If you are still young, you have the capability to take high risk investments. The types of investments that give you the highest ROI are the following;
Real Estate Investing
You can succeed in real estate investing if you know how to leverage money, time and people. Find out how to build wealth through real estate investing.
Equity Mutual Funds – this type of investment has a fund manager that will do the investing for you. The funds are invested in the stock market.
If you will choose the right mutual fund companies preferably the top performing mutual fund, you can make as much as 18% or more per year in equity mutual fund investing.
Guide: How to Buy Mutual Funds
High Growth Securities – a direct stock market investing wherein you will buy companies stock shares. In stock investing, experts say you should buy only blue chip stocks. Blue chips stocks are from stable companies and they have the room for growing or increasing its stock value.
If you choose properly the stocks, you can make as much as 25% or more in the stock market.
Business Ownership – if you want to become an entrepreneur, try to have your own business. It is great to become an entrepreneur. You can help your community or other people by providing jobs. One of the most rewarding investments is business. It can also give you a high return on investments. Equity mutual funds and high growth securities are paper assets. If you love paper assets, choose them both.
The most profitable investment is business, however it requires skills such as managing a business, sales and marketing, preparing legal documentations, registering a business name, filing a tax every year etc. It has a lot of hard work but it is a rewarding investment.
Example if you manufacture a food product that cost you $1,000 for 100 pieces and sell the products $15 each. You can make a gross income of $1500 or a net profit of $500 or 50% earnings. It depends on when to sell all your products, the faster the better.
Investing Tips and Warnings
As I have said awhile ago, you should invest based not only because the investment can give you a high return. But, invest because you want to acquire your target earning asset. Be careful in investing in the high risk types of investments. Make sure the investment you have chosen will really help you to meet your financial goal. Ask a financial expert or a certified financial planner and asses your risk appetite according to your age. You should also allocate your investments based on your age.
Find out how to distribute your investments if you are an investor at age 45. I hope you find this article useful and meaningful to you. Have a successful investing journey. May you achieve financial freedom! Thank you for reading.