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Investment is the commitment of money or capital to purchase financial instruments or other assets in order to gain profitable returns in the form of interest, income, or appreciation of the value of the instrument. It is related to saving or deferring consumption. Investment is involved in many areas of the economy, such as business management and finance no matter for households, firms, or governments. An investment involves the choice by an individual or an organization such as a pension fund, after some analysis or thought, to place or lend money in a vehicle, instrument or asset, such as property, commodity, stock, bond, financial derivatives (e.g. futures or options), or the foreign asset denominated in foreign currency, that has certain level of risk and provides the possibility of generating returns over a period of time. Investment comes with the risk of the loss of the principal sum. The investment that has not been thoroughly analyzed can be highly risky with respect to the investment owner because the possibility of losing money is not within the owner's control. The difference between speculation and investment can be subtle. It depends on the investment owner's mind whether the purpose is for lending the resource to someone else for economic purpose or not. In the case of investment, rather than store the good produced or its money equivalent, the investor chooses to use that good either to create a durable consumer or producer good, or to lend the original saved good to another in exchange for either interest or a share of the profits. In the first case, the individual creates durable consumer goods, hoping the services from the good will make his life better. In the second, the individual becomes an entrepreneur using the resource to produce goods and services for others in the hope of a profitable sale. The third case describes a lender, and the fourth describes an investor in a share of the business. In each case, the consumer obtains a durable asset or investment, and accounts for that asset by recording an equivalent liability. As time passes, and both prices and interest rates change, the value of the asset and liability also change. An asset is usually purchased, or equivalently a deposit is made in a bank, in hopes of getting a future return or interest from it. The word originates in the Latin "vestis", meaning garment, and refers to the act of putting things (money or other claims to resources) into others' pockets.. The basic meaning of the term being an asset held to have some recurring or capital gains. It is an asset that is expected to give returns without any work on the asset per se. The term "investment" is used differently in economics and in finance. Economists refer to a real investment (such as a machine or a house), while financial economists refer to a financial asset, such as money that is put into a bank or the market, which may then be used to buy a real asset. From Wikipedia under the
GNU Free Documentation License What is the best way to begin investing in international markets? Q. I am just beginning to learn about investing and would like to invest internationally... just not sure where a beginner like myself should start or how to do it for that matter... or what to invest in (stocks, bonds, mutual funds etc). Any advice? Asked by Shiraz - Wed May 16 09:21:41 2007 - - 7 Answers - 0 Comments A. I think the best way for a beginner would be through an Exchange Traded Fund. Mutual Funds require thorough research because you are trying to evaluate the abilities of individuals to actively manage your portfolio. Rather than spend that time (and money through higher expense ratios), go with an ETF that will charge a tiny fee and give you broad exposure to the international markets. My recommendation would be to check out the iShares EAFE index fund (Ticker: EFA). It will provide you liquid, diversified exposure to Europe, Australia/New Zealand, and the Far East (Ex-Japan). If you have a bigger appetite for risk, you might also consider the emerging markets - look at Ticker VWO from Vanguard or EEM from iShares. Answered by Dan B - Wed May 16 09:32:10 2007 Is it a good time to start investing in BP stocks? Q. With the BP stock prices dropping, would it be a good opportunity to start investing in BP stocks now or pretty soon? I doubt they will go bankrupt. They seem like a strong company even with what's happening now. What are your opinions on this? Please no comment on the oil spill disaster. I just want to know if they would be a good company to invest in for the future. 1 second ago - 4 days left to answer. Asked by RB - Fri Jun 18 08:37:40 2010 - - 1 Answers - 0 Comments A. I think lots of people have this idea, buy BP while it's low and reap the rewards in the future. Just today, I've seen several people asking the same question on YA. I have no idea whether it's smart or not, but if everyone else is doing it, the reward won't be as high as you think it is. Answered by Alex - Fri Jun 18 16:17:31 2010 How do i start in investing share markets?
Q. I want to know about stocks, shares and how i need to start investing in stock/share market? Asked by JOHN - Tue Oct 14 04:04:56 2008 - - 7 Answers - 0 Comments A. The very old saying Do not keep all your egg in one basket applies. While investing keep following in mind. (1) Safety (2) Liquidity In my opinion invest 20% in stock (speculation) 40% in medium term consistent interest earning deposits (from well known companies) , 20% in long term investment and 20% in liquid asset (savings deposit, cash) to meet unforeseen exigencies. Answered by brnrlmkar - Tue Oct 14 14:19:05 2008 From Yahoo Answer Search: "Investing"
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