provide descriptions of the following investments options and elaborate on the risk factor of each...Unit trust,shares,fixed property,debentures
Answers
"Unit Trust- it’s a pool of money formed by the investment of various investors, and this pool is then invested by a fund manager into various assets to multiply the fund. This minimizes risk as the money is monitored by a learned experienced fund manager and invested in many schemes.
A share is a portion of a company’s ownership, and it may be in any percentage or face value. Investing on shares is always risky as the money may multiply or may totally go in loss.
Fixed assets are things like property, car, and house etc, where the money can be invested. This is not risky as the item is owned and can be used. But whether you will get a high or low rate while selling it, depends on many other factors.
Debentures are investments on a company, which is not secured by any collateral or physical assets. Debentures are backed by the reputation of the issuing company. They are medium risky, but guarantee to pay an interest at a fixed rate for a long term as long as the company is performing well.
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