There’s a lot of vehicles to invest in. Main difference between each of them is: risk, liquidity and potential returns. Common saving account has high liquidity and low risk but on the other hand returns are generally low. On the other hand land/property has generally low risk, higher returns than saving accounts but lower liquidity. Gold/silver has high liquidity, good potential returns but higher risk than previous ones. Shares are other extreme – high risk, high potential returns and good liquidity (in most cases),
Less common investment vehicles:
- BitCoin
- Fine Wine
- Stamps
- old Cars
- limited series items (coins, shoes, vinyl records etc.)
Few tips for shares:
- Read and learn before you start. Start small.
- Demo investing (without real money) doesn’t count or help – you will behave differently when real money is at stake.
- Look around in real world what seems to work well – and check if you can invest in it.
- Focus on industry you know or work in, don’t invest in fancy tech stocks if you work in pharmaceutical and vice versa. You’re more likely to know what company is doing well when you understand their business very well.
- Keep in mind you can loose almost everything.
- Keep calm when things are turning wrong – declining shares will bring good times for buyers.
- Stay away from funds with high management fees (most of them).
- Check how much is your broker charging for foreign exchange fees if you plan to buy foreign stocks (those 3% when buying and another 3% when selling could make huge difference).
Resources for more:
- Money by Tony Robins – great starting point for money management and investing
- One up on Wall Street by Peter Lynch -older book, starting point for shares investing and tip how to do your research before getting involved
- Shares magazine – good to learn about smaller companies