Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Investing

What it is:

Investing is the strategic purchase or sale of assets in order to produce income or capital gains.

How it works (Example):

Investing can involve the purchase or sale of stocks, bonds, mutual funds, interest-bearing accounts, land, derivatives, real estate, artwork, old comic books, jewelry or anything else an investor believes will produce income (usually in the form of interest or rents) or become worth more.

Why it Matters:

The safety of the principal is of concern in any investing activity, although some investors are more risk tolerant than others and are thus more willing to lose some of their principal in return for the chance of generating a higher profit. The investor's ability to tolerate risk and the incremental return associated with increasing amounts of risk are two primary factors that distinguish types of investing and help determine appropriate investments for a given investor.

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