To venture into high-return investments also means one can simply lose some or all of the invested money. After all, high return investments also imply high risk. There are lots of investment options available, therefore making it very difficult to decide what to invest in. Knowing your investment goals and the risk involved can help in making the right decision.
Here are some investments you can put into consideration if you want to earn high returns.
Certificates of Deposit (CDs)
In this kind of investment, a deposit is made for a specific period without making any withdrawal until the stipulated time. This can be for weeks, months, or years and it yields more interest in comparison to savings accounts. It is better to go for a long-term CD account if you want more interest.
Stocks with high dividend
A dividend is part of the profit from a company or corporation that is paid to shareholders which is done quarterly. Buying stocks that pay a dividend is what good investors will do. This is because it comes with an assurance that, no matter what the market conditions look like there will be a dividend increase.
Investing in companies that have a consistent dividend increase and financial stability is advisable. Hence, the need for proper research.
Corporate Bonds
This type of investment involves you lending capital to a large corporation. The corporation commits to pay back with interest on your previous capital and return the principal capital when the bonds matured.
This kind of bond is foreseeable and is without a complicated strategy. The higher returns of corporate bonds are better than the government bonds of CDs. Another benefit is that you are given the freelance to invest in different sectors and easily cash out before maturity.
Crowdfunded Real Estate
Crowd-funded real estate involves raising funds from the public to sponsor projects. Individual investment in real estate can look impossible, especially when home prices are too expensive, therefore this option can be used.
Nowadays, projects are listed on real estate crowdfunding platforms which allow any interested person to invest in real estate. In this kind of investment, risks are kept low and there is high interest. For this, it is still essential to evaluate the project before investing.
Investing In Preferred Stock
This type of stock has an equity portion and a debt portion. It involves adding to a dividend stock theme. It has lesser risk than common stock, though it is not traded heavily as common stock.
Investing in preferred stock makes you a shareowner in the company and at the same time, you get a dividend payment.
Bottom line
Investment helps build your wealth over time. The first thing to put in mind is to buy the right investment at the right moment and also sell it at the right time.
Factors like risk tolerance, time horizon, and deep knowledge should be put into consideration before investing. These above-mentioned investments promise high returns at low risk when done right.
