INTRODUCTION TO INVESTMENT OPTIONS
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Before you rush to your broker and start buying, you have some
thinking and planning to do first. To choose from the growing
universe of investment options, you have to decide what you want
your investments to do for you.
Are you looking for investments that will pay you income on an
ongoing basis? You might look to savings accounts, certificates of
deposit (CDs), bonds, or bond mutual funds.
Do you want your investments to grow in value so that you can
receive a large payout when you sell them at some future date?
Stocks and growth mutual funds might be among your choices.
There are many different kinds of investments to choose from.
Each kind of investment differs from the others in objectives and
benefits. Some differ by how much they can be expected to earn.
They also differ in relative volatility—how much their
value changes compared to the market as a whole.
Investor returns may be in the form of interest, dividends, or
Interest and dividends are current income
distributed by income-producing investments.
Capital gains result from the sale of an investment for
more money than you paid for it.
We will turn now to one of the simplest
investments—the good old savings account.