If you are currently thinking of how to best use your spare money, investing is a great option to consider. Many people deposit their money in a bank savings account but doing so is likely to return a pitiful amount of annual interest. Investing in a different way can bring you a much better return and will help your finances to grow at a faster rate.
The issue with financial investing for many people is that it seems scary and confusing. A lot of that is due to the sheer range of investment vehicles on offer. If you need a helping hand with choosing which markets to invest into, the information below will help. All are popular places for people to invest their money and are widely used by global investors to build their wealth.
One very simple and straightforward way to invest money is binary options trading. When trading in this arena, you simply choose which asset to invest in and how long you will invest for. After that, you simply enter whether you think the price will go up or down and how much you will invest. When the time period (which is usually quite short) has expired, you either get your winnings or lose the initial investment. The beauty here is that it does not involve complex money management strategies, worries about leverage or tricky margin calls. You are simply left to decide which way the price will go in a set time and make money from it if you get it right. This is also one trading choice where big profits can be made quite quickly.
Another area you could invest money into is cryptocurrency. Popular examples of this include Bitcoin, Altcoin and Ethereum. Out of all of them, it is Bitcoin that makes the most headlines and is the one you may know a little about already. It is possible to buy and sell cryptocurrency on specially developed crypto exchanges. Naturally, if you buy low and sell high, you could make money.
You can also invest into individual currencies in a more traditional way via online brokerages. This is where you invest in a certain cryptocurrency for example and make money if the price moved in your favor over time. One thing to understand with digital currencies is that they are highly volatile in nature. While this does present great chances of making big profits, it can also see the market move heavily against you in a short time.
Stocks and shares
Of course, when it comes to financial investment then stock trading will always be popular. This means buying individual shares in publicly listed companies. If the share price goes up after you buy, then you can sell to make money on the deal. The biggest stock exchange globally is in New York and has a $22.9 trillion market cap. Other big exchanges worldwide are in London and Hong Kong.
Stocks are a good investment for beginners as they are easy to trade and can bring in decent returns over time. This return is normally maximized by holding onto stocks for longer periods so you may be best looking elsewhere if you like daily action! People also like investing in stocks as they do not require as much management over longer periods. As long as you keep a fairly regular eye on them once or twice per month, this can be enough to help keep your share portfolio in shape. A further advantage is that companies pay dividends to shareholders each year, the amount being linked to the level of profits made.
Peer to peer lending
One curveball when it comes to investing money is P2P lending. It is a new kid on the block when compared to markets like stocks and this means many people miss out on it. That is a shame as it can help to bring in decent returns and is very simple to become involved with. P2P lending operates through online platforms like Funding Circle and provides a way to lend money to businesses that need it to fund the development of new products. These platforms are very intuitive to use, and they let you set your own risk tolerance for the businesses in which you invest. You are acting like a bank by lending money to companies that pay it back to you with interest over an agreed period of time.
Investing is a wise move
Making the decision to take some of your spare cash and invest it to generate more is a wise move. These kinds of financial investment can help to build your wealth over time and more quickly than simply putting it in the bank. Of course, for anyone not experienced with investing money, it can seem a daunting arena to enter. Hopefully the above tips have given you a few ideas on how to start putting your money to work.