Making good financial decisions may not be as simple as some people may think today. Even though there are some clear choices that tend to be good investments from the start, the economy can easily change on a dime.
This is especially the case when the global market depends on special circumstances like a natural disaster.
Therefore, before you take out your pocketbook to invest in anything, you need to know a little bit more about both good and bad investment opportunities.
With that said, here are ten examples of both good and bad opportunities that you need to be familiar with today.
Five Good Investment Opportunities
1. Short Term Corporate Bonds
Whenever a corporation needs to raise funds quickly, they usually have a wide range of things that they can do. In some cases, this may even mean tapping into the resources of the smaller investors by issuing bonds.
These short term corporate bonds are often good choices for those of you who want to earn money with a lower risk investment opportunity that matures between one to five years.
2. Investment in Stocks that Split
What is a stock split? If you know the answer to this question, you may already be an investor in the stock market.
A stock market split is a great benefit since they give investors two to every one of the shares that they presently own.
3. High Yield Savings Accounts
Savings accounts can be a great investment choice for earning additional money on the funds that you have in the bank. In fact, some of today’s banks are offering an interest rate above two percent.
This is quite a lucrative gain, specifically for those of you who are looking to access your money easily in the near future.
4. Rental Housing
Just like investing in high yield savings accounts make good sense, investing in rental housing is considered to be a good investment opportunity as well.
Based on the timing of these kinds of investments, rental housing can be an excellent source of income for anyone who is expecting to retire in the near future.
5. Growth Stock Funds
If you are a newbie to the investment industry, you may want to focus your investment efforts on growth stock funds.
Growth stock funds are ideal for many different reasons, including for those of you who want to take advantage of a diverse broad portfolio.
Five Bad Investment Opportunities
1. Penny Stocks
If you are looking to earn quite a bit of money on the stocks that you purchase, you need to know which ones will not give you what you are looking for.
One of the most notable is the penny stock since they are often referred to as parts of the pump and dump tactics.
2. Commodity Futures
Before you decide to invest in commodities, you need to know what the future holds for that specific type of commodity.
This is because these types of investment opportunities are relatively high risks and people need to know what they are before they make an investment.
3. Investing Lucrative Sums in Tax Shelters
Every business has an opportunity to take advantage of specific types of shelters today so that they can reduce their tax burden.
Though this is true, every business owner and their management must be wise in the types of shelters that they are investing in, specifically before they spend loads of money trying to avoid paying taxes.
Since the laws in this area can be complex, the wrong investment may mean carrying loads in financial debt and will not yield any opportunity to write it off in some tax years.
4. Digital Currencies
Some digital currencies are considered to be very great opportunities for people to invest in. Based on the digital currency that is the most popular, investors can double their earnings.
On the other hand, there are currencies that do not do well at all. Therefore, they should be avoided as good investments.
Some collectibles are considered to be very bad investments based on their present and future prospects.
In some cases, the investor can make a huge mistake if their speculation into a certain product is not good at all or simply misleading.