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Recap of the Foundation Course: Investments

Before you jump into the Intermediate module on investments, let’s make sure you’re equipped with some essential concepts by revisiting some foundational concepts that will help you get the most out of this next step.

What Are Investments?

Investments are like planting seeds with the hope of reaping a larger harvest later. When you invest, you’re putting your money into something—like stocks, gold, or fixed deposits—with the expectation that it will grow in value over time. This growth is the reward for taking on some level of risk.

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Savings vs. Investments

    Savings focus on preserving your money with minimal risk, typically in accounts that earn modest interest. Investments, on the other hand, aim to grow your wealth by allocating money into assets like stocks, bonds, or real estate. While investments offer higher potential returns than savings, they also carry the possibility of loss, making them a balance between risk and reward.

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Understanding Inflation

    Inflation is the gradual increase in prices over time, meaning you need more money to buy the same things. It’s important to consider inflation when investing because it can erode the purchasing power of your savings. Some investments, like stocks or real estate, can outpace inflation, helping to preserve and grow your wealth.

Investment Options

There are various ways to invest, from buying stocks (shares in a company) to investing in bonds, gold, real estate, or even fixed deposits. Each option has its own risk and reward profile, and the key is to choose the right mix based on your goals and risk tolerance.

Making Smart Investments

Smart investing is about making informed decisions. This means doing your research, understanding how markets work, seeking professional advice, and diversifying your portfolio to spread risk. It’s also important to stay consistent and avoid schemes that promise quick riches. 

These foundational concepts will prepare you for the more in-depth strategies and techniques we’ll cover in the Intermediate module. For instance, we will discuss the benefits of portfolio diversification, how risk-profiles play an important role, types of mutual funds, and more! Get ready to build on this knowledge and take your investment skills to the next level!