Previously in the Back to Basics series, I have written about:
Today, we shall be perusing at what’s out there and what’s available for us to invest in.
Generally, there are four major asset classes available.
They are:
- Equity
- Cash/Money Market Securities
- Fixed Interest Securities
- Property
Here are some explanations and examples of the above-mentioned asset classes:
EQUITY MARKET
In the most simplistic sense, equity is another name for stocks or shares.
Examples that come under this category are:
- Malaysian stocks
- Australian company stocks
- Unit trust funds/managed funds/mutual funds
- Foreign stocks
CASH/MONEY MARKET
The money market forms a part of the debt market. Generally, securities traded in the money market have maturity periods of less than 12 months. Maturity basically means, your positions will be exited within the time frame.
Examples:
- Bills of Exchange
- Bank Bills
- Treasury Bills
- Promissory Notes
- Certificates of Deposit
- Treasury Notes
- Unit trust fund or mutual funds dealing with money markets
FIXED INTEREST MARKET
This is the other portion of the debt market. Generally, securities traded in this market have maturity periods of more than 12 months. Contrast this with the money market securities above.
Examples:
- Government Bonds
- Corporate Bonds/Debentures
- Unit trust fund or mutual funds dealing with fixed interest markets
PROPERTY MARKET
What comes under this heading? Well, your guess is most probably right. Property market is basically whatever there is out there connected to real estate such as houses, apartments, commercial buildings, lands, factories, and etc.
Examples:
- Direct property investment
- Indirect property investment such as unit trust or mutual funds specialising in the property market
- Real Estate Investment Trust (REIT) / Property Trusts
We shall look at each of the asset classes in detail in future articles.
Disclaimer: This article is not a specific nor general advice on managing or investing your money. This article does not constitute a recommendation nor does it take into account your investment objectives, financial situation nor particular needs.
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Other related posts:
– CFD Trading : An Introduction
– CFD Trading/Share Trading : Setting Stop Loss
– Investing & Trading. What’s the difference?
– CFD Trading/Share Trading : The 2% Rule
– Do What You Think is Right
– What is Financial Freedom
– Passive Income Exceeding Expenses
