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What are the main types of Investments?
Equities, bonds, funds, financial markets, investor profile, return, risk… It’s hard to take the plunge when you’re overwhelmed by all these terms… It’s often the first thing that stops us: “I don’t know anything about it”. Here are some explanations of simple words that seem complicated.
Shares
When you buy a share in a company, it means you own a small part of it.
It is possible to receive part of the company's profits in the form of dividends. The remainder of the profits generated will increase the value of the company and therefore of your investment.
Funds
Investing in a fund means buying a basket of equities, bonds or other investment products.
The value of your units increases according to the fund's performance.
Bonds
When you buy a bond, it means you loan money to a company or a State.
In general, you can earn periodic interest on your investment.
What are the most common securities?
Explanations by Philippe Ledent, Senior Economist at ING Belgium.