Unless you know the basics of investment, it is impossible to make sound investment. You can plan your investments fitting your circumstances only if you understand the basic alternatives. We invest to grow our money to be used for various purposes. Investing is considered to be an act of placing money in certain scheme to get a good return for the amount invested. Some people consider investing as the process of buying and selling real estate, stocks and shares or other consumer goods. The term could mean differently for each person.

How to decide on investment? - This is the first question one tends to ask himself when he needs to invest, but does not know the basics of investment.

Fixed Accounts can be the best option to keep your money safe. The interest rate is higher compared to cash equivalents. US Savings Bonds, Bank CD’s and Fixed Annuities come under the category of Fixed Accounts. The only disadvantage is that you are required to pay penalties if you withdraw your money before the specified time period

By placing your money into cash equivalents, you can get instant access to it if needed. Bank savings accounts and money market mutual funds are examples of CASH. Instant withdrawal without penalty is possible and you also get high liquidity.

You can go for Bond investments if the risk involved due to fluctuation will not bother you. Corporate bonds, municipal bonds and US treasury bonds are some of the bonds you can consider. Investing in bond mutual funds can be given a thought as it satisfies the needs of bond investors.

Equities are for those who are in search of higher returns for their investment and who can face the risk involved. Appreciation in the value of stocks and dividends offered by the companies are the two ways by which the investors can get returns for their investment in stock market. By investing in diversified shares, you can reduce the risk of losing your investment. Equity mutual funds are the best alternative if one needs to invest in shares. An equity mutual fund is a category of investment fund that buys you partial ownership in businesses. The portfolio manager of the funds is required to use the shareholder’s cash to invest in equities like stocks of traded companies.

Investing in silver and gold, real estate and other products can be promising almost always. But you need to have a great amount to invest or rather block in this type of investment, as you need to wait for some time to realize great appreciation which should be worth the huge investment amount. Natural resources such as oil and minerals and iron, aluminum and copper come under this type of investment. If you are not able to cope up with every minute changes in share market, you can go for mutual funds investing in real estate investment trusts. Similarly, buying mutual funds investing in oil stocks can give you good returns as the prices of the oil and natural resources soar high.

By considering diversified investments, you can have a balanced portfolio of investments. For More Visit : http://www.successfulinvesting.us/Mutual-Funds-&-ETFs.html.