. If you are it will interest you to know that there are actually quite a few different securities to invest your money into. Each has its own advantages and disadvantages, so what are they?
1. Bond Securities
The first kind of security is a bond. A bond is basically debt. When you buy a bond from a company you are buying debt from that company. The company has to pay you reoccurring interest payments and at the end of the lifespan of the bond they have to buy it back. In short you become the bank. You loan money out, get interest payments, and get your money back. It is a relatively safe way to invest your money.
2.Commodity Futures
A future contract is a contract that allows you to own a specific commodity at some point in the future. As such you benefit from the ups and downs associated with that commodity. Just remember that future contracts are better for short term trading because if you hold the contracts too long you may end up with the commodity and have no idea on what to do with it.
3. Buying Stocks
Another way to invest your money is to invest into stocks. These are simply investments that allow you to control part of a company. As the company grows so do your shares of stock. In addition to that, if you happen to own dividend paying stocks you will also make money as the company makes money because they pay you.
If you pick the right company they can be very nice investments.
4. Exchange Traded Funds
ETFs are basically securities that hold other securities. An ETF may hold one or more of the above securities and it may focus on one section. For instance an ETF may consist of airline stocks and hold the top 10 airline companies in the United States.
Investing into ETFs can alllow you to invest into a diversified portfolio of stocks, without having to pick specific companies.