Definition of Investment
Investation
Definition of Investment
"Investing money or capital in a company or project for the purpose of obtaining profit.""Investment, usually in the long term for the procurement of fixed assets or purchase of shares and other securities to gain profit (investment)."
Investation
What is Investment?
Investment is the activity of placing capital in the form of money or other valuable assets into an object, institution, or a party with the hope that the investor or investor will receive a profit after a certain period of time. It is because of the hope of getting a profit at a later date that this investment is also referred to as an investment. The term investment itself comes from the Italian word, investire which means to use or use. Generally, funds or assets invested by an investor will be developed by a managing body or party. Profits from the results of the development will later be distributed to investors as a return in accordance with the provisions between the two parties.Economically, in investing, investors will buy something that will not be used now. Something that is purchased is stored as property which after a certain period of time can experience a change in value. Investments do not always end up making a profit. There is also a risk of loss in investing. Therefore, it is very important to understand the types of investments and their risks.
Investment Purpose
Here are some important goals of investing:- To get steady income
- To obtain a more decent and stable life in the future.
- Useful for developing a business
- Get assurance in business
- Establish and control funds for a special interest, for example, such as social interests, expansion interests, etc.
- Reducing inflation pressure
- Investment can be used to maintain relations between companies
- Participate in the development of the country.
Investment form
After knowing the types of investments, the rows of types of investments are also grouped into two different forms, namely:Real Asset Investment: This investment is made by someone either in visible or invisible forms, such as land investment, metal investment, property investment, etc.Investment in Financial Assets: Investment in financial assets is carried out by investors as a form of security. Examples of investment deposits and stocks .
Investment Types
There are many types of investments that exist today, including:Property Investment- Gold Investment
- Stock Investment
- Mutual Fund Investment
- Foreign Exchange Investment
- Bond Investment
- Sharia Investment
- Cryptocurrency Investment
- Deposit Investment
Types of Investment Based on Timeframe
There are two types of investments that are categorized based on their timeframe, namely:Short-Term Investment Short-
term investment is an investment that allows you to get a profit of less than three years and you can immediately convert it to money or sell it. However, keep in mind that this short-term investment provides a smaller return so it is suitable for meeting needs in the near future. Examples of short term investments are short term bonds, stock market, certificates of deposit.
Long Term
Investments Long term investments are investments that take more than three years to generate returns. You can enjoy the results of this investment in the next five years, dozens of years, even tens of years. The returns generated by long-term investments are of course also greater than short-term investments. This type of investment is perfect for those of you who need savings for future needs such as educational expenses, funds for marriage needs, retirement funds, and so on. Examples of long-term investments are stock investments and gold investments.
term investment is an investment that allows you to get a profit of less than three years and you can immediately convert it to money or sell it. However, keep in mind that this short-term investment provides a smaller return so it is suitable for meeting needs in the near future. Examples of short term investments are short term bonds, stock market, certificates of deposit.
Long Term
Investments Long term investments are investments that take more than three years to generate returns. You can enjoy the results of this investment in the next five years, dozens of years, even tens of years. The returns generated by long-term investments are of course also greater than short-term investments. This type of investment is perfect for those of you who need savings for future needs such as educational expenses, funds for marriage needs, retirement funds, and so on. Examples of long-term investments are stock investments and gold investments.
How to Invest
If in the past investments required complicated administration, now investments can be made easily and inexpensively. Only armed with a smartphone , for example, you can invest through Tokopedia's investment products such as Gold and Mutual Funds . The nominal for investment can start from $ 100.Investment Benefits
Investment also has many benefits for investors. Here are some of the benefits or advantages of investing that can be picked up:Increasing Assets
This can be applied to property investment in buying land, apartments or houses whose prices will rise in the future. However, an increase in asset value is not obtained in a short time, it takes a long time and patience.
Meeting Future Needs
Because there are many unexpected needs in the future, investment is very appropriate as a means of meeting future needs. Investments in the present aim to support and support life in the future because the value will increase.
Frugal Lifestyle
With investment someone will try to live frugally to keep investing, in the end that person will avoid buying things that are not important and are more economical.
Avoid Debt
With a simple lifestyle, someone will avoid debt. People who have an investment commitment will avoid debt and prefer to live frugally to improve economic conditions.
This can be applied to property investment in buying land, apartments or houses whose prices will rise in the future. However, an increase in asset value is not obtained in a short time, it takes a long time and patience.
Meeting Future Needs
Because there are many unexpected needs in the future, investment is very appropriate as a means of meeting future needs. Investments in the present aim to support and support life in the future because the value will increase.
Frugal Lifestyle
With investment someone will try to live frugally to keep investing, in the end that person will avoid buying things that are not important and are more economical.
Avoid Debt
With a simple lifestyle, someone will avoid debt. People who have an investment commitment will avoid debt and prefer to live frugally to improve economic conditions.
Investment Risk
Besides having many benefits, investment certainly also has a number of risks that investors must be aware of.- Business Risk
- Liquidity Risk
- Financial Risk
- Country Risk
- Exchange Risks
Factors Affecting Investment Rate
- There is a change in the rate or exchange rate
- Interest rate
- Infrastructure
- Inflation rate
Things to Look For In Investing
If you want your investment to be successful, here are some important things you should pay attention to:- Do not make investments in a hurry and must be accompanied by in-depth understanding or research, including regarding the most potential investment objects to choose from.
- Do not act speculatively.
- It is important to consider the investment timeframe.
- Know and assess the amount of capital that you can prepare.
- Understand the risks that can occur as an investor and the type of investment chosen.
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