Start it Young: Knowing What Investment Suits You

By: Rose Mary Madrigal

Before investing, it’s important to do your research first to know which or what types of investments would be suitable for your capital — it could be in the stock market, or a real estate with a condo for sale. Like most investors, investments do not start out easy. So if you’ve just entered the world of investing especially in today’s modern market, learn the different options there are to put capital or to invest in.

Asset Classes

Asset classes or investment is the long-term goal of putting your hard-earned money or capital now to achieve a goal of generating income. In general, you want your invested money to grow over a period of time. Apart from that, receive regular income once you made enough and are confident with investing.

There are a few types of asset classes, but for most investors, these are the major assets that are commonly invested:


These are like money market instruments which are the most liquid or can easily be sold in the market when you want to.

Real estate/Property

The least liquid of investment types is because it takes a while for it to be sold.


Usually has high inflation and is money lent to the government or a company.


These are everyday goods like beef, oil, gold, or anything industry.


Also known as “equities”, cash flow is generated from businesses like organizations or companies.

What Are the Different Types of Investments

For investors, start out with an investment portfolio. This will be great to keep track of market ups or downs and would benefit you for future retirement plans. As a new investor, before further reading about the other types of investments, know your risk tolerance before investing.

Here are the types of investments or asset classes to get you started.

Mutual funds

Mutual funds are a collection of investments pooled from different investors. It is typically managed by a firm but this differs from other types of mutual funds.

Money market funds

One of the large types of mutual funds. This type of mutual fund allows investors to leave their money to the bank for a predetermined period. Once the period is over, you can get your principal but with a bit increase in rate. The downside to this is an annual fee or an expense ratio just as with mutual investing as well. This will affect a portion of your share even if a small percent to be deducted.

High-interest savings accounts

Cash equivalents are mostly bank accounts or interest payments in savings accounts. These types of investments have less interest than what will be mentioned in this article. They are mostly about securing your money with added little interest.

Cash equivalents also include high-interest savings accounts and term deposits. They provide a stable income of interest payments and are also considered defensive investments. They grow little value over time.

Money Market Instruments


As mentioned earlier, dividends are shares from businesses or companies you invested in. Basically, dividends are a portion of a company’s profit paid among shareholders or those who invested in their market. The value of an investment in stocks is to consider a more eligible company. While growth type in stocks is a strategy among small or minor businesses before they achieve in financial markets. In stocks, the value can be affected by political, and economic changes and the company’s earnings.

Common stock

This type of stock investment receives income and voting right or participation in the business.

Preferred stock

Preferred stocks are investors that get the shares or dividends first-hand


Bonds are debt instruments that allow you to lend money to the government or company. Bonds have fixed interest rates. Considered the low-risk investment, however, decreases in value over time but if you pay higher will increase its value and risk. Bond investment types earn interest when the bond issuer pays the borrowed money in the form of installments.

The total principal is when the bond is paid on the maturity date. Government bonds are the less risky followed by corporate bonds. It’s also considered a fixed-income type of investment because of you of the regular installments.

Other types of fixed-interest investments are government bonds, treasury bonds, and corporate bonds.

Index funds

Index funds are a type of mutual fund and unlike mutual funds, they are much cheaper because of how they are managed.

Dividends or interest rates are the usual earnings of index funds. Simply, index funds try to copy or imitate the benchmark, unlike mutual funds.

ETFs or Exchange-traded funds are also mutual funds similar to index funds but differ in how they are purchased.

They track the underlying index of the collection of investments so the price fluctuates throughout the day unlike mutual and index funds priced once at the end of the day. Most of these tradings are done in the stock exchange

Real estate investment

Real estate investments are the riskiest type and physical investment type. When purchasing real estate or you have a property, you can invest that to earn regular income.

Among the different types of investments, real estate investments can also increase in value such as land or where the property is situated.

Commercial or residential properties

Investors can do investments directly or they can invest in real estate investment trusts (REITs). REITs offer investments in companies that have real estate rather than risking to invest directly in real estate.

What real estate looks like and where it is located is an important factor to increase its value. So if you’re investing in real estate, look for properties or condos for sale near you that offer amenities and easy access to the city as well as being near malls like Evia and NOMO.

As an investor, remember to start working towards your financial goals, understand the value of each investment, and what it can do for your money.

There are other assets that you can venture into. Ask industry experts for advice and consultation on which types of investments would suit you to maximize your capital growth. Start with your investments now and watch your money work for you.

Related Blog: Everything You Need to Know: Investment in Properties

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