Making Money from Money

Instead of putting your money into cold storage, put it to work for you by investing. Whether you open a savings account, invest directly in the stock market or make use of some other investment option, your “extra” money can make more money for you.

Just how lucrative are your investments? That depends on the plan you choose as well as the amount of risk you’re willing to take. But whether you’re a risk-taker or a play-it-safer, there are options to help your nest egg grow.

Savings Accounts

Savings accounts are the safest of investments. Usually insured, your money is available to you when you need it. Your bank pays you a fee— known as interest—for allowing them to use it.

• The upside? You can withdraw your money at any time with no penalty. Also, there’s practically no risk involved.
• The downside? Interest rates are typically very low—around 1.5 percent—and sometimes barely keep up with the rate of inflation.

Certificates of Deposit

Want to get a slightly higher interest rate in exchange for investing your money for a specified amount of time? These accounts are called Certificates of Deposit (CDs) and range in length up to several years.

• The upside? CDs are very safe investments because they offer low risk. The longer you agree to keep your money in the bank or financial institution, the higher your interest rate.
• The downside? There’s usually a $500 minimum to open a CD, and there are costly penalties for withdrawing your money early—so don’t invest money you may need access to. Also, since your interest rate is locked in, you won’t earn more if interest rates later go up.

Money Market Fund

When you open a money market fund, your bank spreads the money you invest over a number of CDs and other short-term investments. You retain access to your money, and your investment is relatively secure with a fixed income rate.

• The upside? These are generally safe investments, and you can redeem your shares of a money market fund at any time with no penalty.
• The downside? You get about the same (usually low) return as you would on a CD—and sometimes lower than a CD. You may also be required to keep a minimum balance in your account, and may be charged fees if you slip below that minimum.

Forex

Investing in Forex allows you to own part of a business.

Online forex trading has become very popular in the past decade because it offers traders several advantages:

Forex never sleeps

Trading goes on all around the world during different countries' business hours. You can, therefore, trade major currencies at any time, 24 hours per day. Since there are no set exchange hours, it means that there is also something happening at almost any time of the day or night.¹

Go long or short

Unlike many other financial markets, where it can be difficult to sell short, there are no limitations on shorting currencies. If you think a currency will go up, buy it. If you think it will fall, sell it. This means there is no such thing as a "bear market" in forex - you can make (or lose) money any time.

Low trading costs

Most forex accounts trade without a commission and there are no expensive exchange fees or data licenses. The cost of trading is the spread between the buy price and the sell price, which is always displayed on your trading screen.

Unmatched liquidity

Because forex is a $4 trillion a day market, with most trading concentrated in only a few currencies, there are always a lot of people trading. This makes it typically very easy to get into and out of trades at any time, even in large sizes.

Available leverage

Because of the deep liquidity available in the forex market, you can trade forex with considerable leverage (up to 50:1). This can allow you to take advantage of even the smallest moves in the market. Leverage is a double-edged sword, of course, as it can significantly increase your losses as well as your gains.

International exposure

Mutual Funds

A mutual fund allows you to pool your money with other investors to buy stock in a number of companies. The mutual fund manager, who oversees investments in the fund, selects the companies based on the investment philosophy of the fund.

• The upside? Because your money is distributed among various stocks, the risk is lower—even if one stock bombs, you’re still OK if the other stocks increase in value.
• The downside? Many mutual funds require a minimum investment. You may also pay a fee, called a “load,” to have your fund managed by someone else. In addition, there may be a specified “holding time” during which you won’t be able to sell the stocks in your fund. As a result, mutual funds are a great deal less “liquid” than other investment options—meaning you won’t be able to convert your investments back to cash easily if you need the money.

Bonds

Bonds are like IOUs that large organizations make out to investors. With a bond, your investment is really a long-term loan. Bonds are referred to as “fixed-income” securities because the amount of income the bond earns is set when you buy it. When you purchase a bond, you receive a document recording the amount lent, the interest rate and how often interest is paid.

There are four kinds of bonds: federal government, corporate, state and local government and foreign government (these are rare for individual investors).

• The upside? The risk can be minimal, depending upon the source of the bond. For example, U.S. savings bonds are insured and guarantee a certain rate of return.
• The downside? Bonds don’t offer a very high return on your investment, and they typically require an investment of $1,000 or more. And in some cases, the bond is not insured, which means you may have no guarantee that you will make money on your investment. If you purchase a bond from a company that later goes bankrupt, you’ll lose your investment—so you need to investigate carefully before investing in corporate bonds.

Learn about your options before investing, and decide how much risk you’re willing to take. Then make a choice about your financial future and put your savings to work!

If you are still looking for a best forex brokers online.you can visit http://www.qiantu168.com/best-forex-brokers_top-forex-brokers_forex-brokers-review