Investment Fundamentals Week 2
Types of Investment Main reason to purchase landed property - land and building – is for investment. There many types of investment exist – but mainly funds are put in Property and real estate Gilts/government bond Equities/share/stock market Investors will decide which form of investment suit with their objectivesamdrequirements. The form of investment available are:-
Goods and chattels – something that is durable and long-term life expectancy such asjewellery,vintangeor limited run motor cars,yachstand boats, aircraft, antique furniture. National savings certificate and bonds – very safe investment as precise purchase price and interest are known. Bank or building society deposit or savings accounts – very safe investment as the money is guaranteed by the government through some form of insurance. Life insurance policy – with profits policies provide that the insurance company will increase the size of the guaranteed payment on maturity, depending on the profitability of the company each year over the policy term. Unit trust and investment trust – offer to small investors, with limited or no knowledge – to invest in stock market at reduced personal risk. Precious metal and stones – gold, silver, platinum and diamond. For retention of maximum value, precious stones are retained in an uncut state, poorly cut stones can suffer a serious depreciation of value. Works of art and collection of rare objects – painting, sculptures, miniatures, crystal glass, postage stamp, coins, medal, etc. can all command high value depending on quality, pedigree and rarity. It involve bidding process. Currency and commodities – mostly traded for short term speculative gains rather than long term investment. Stock and shares – shares represent part-ownership of a company; whereas debentures are forms of loan to companies and to central or local government. Real Estate – alternative term are real property, property, landed property or land and buildings. It is possible for there to be different interests are owned in a single property; all owned by different people at the same time.
Type of Investors Mainly, investors in real estate are: Life insurance company and pension funds i.e. EPF [email protected] London Project. The traditional purchasers of commercial property Have long control of long term funds, which acquired without borrowing. As they are acting on behalf of their savers to provide a good long-term return on their investment, capital appreciation may be more attractive than income. Banks; commercial, merchant and investment. Property unit trust i.e. REITs Property companies and property developers Generally buy property for development purpose – able to design-and-build the complete scheme; On completion, they may retain the development for investment purposes, or they may sell it on the market.
- Fall '13