Get acquainted with different types of investment models
Types of investment models are divided into several items according to some factors such as the amount of knowledge of investors, investment time, its return and some other parameters.
However, the ways and means of investing are different from this. This means that each model can include several different investment methods.
We refer to the most important models here. Then we will discuss the main methods and different ways to invest.
What is direct investment?
In direct investment you will directly manage the investment. For example, when a person sets up a production workshop using personal capital and savings, he or she is investing directly here.
While many times people tend to transfer their capital to someone else under a contract. In the direct investment method, the risk of doing the work is usually higher.
Because not all people have the knowledge and expertise to do this. In addition, most of them do not have enough time to keep up with the market.
For those who are new to the field, it is best to use the indirect investment method. They can continue to increase their knowledge and expertise in other ways.
There are several examples of this type of investment, including investing in the gold, currency and housing markets.
What is Indirect Investment?
Another type of investment is the indirect model. In this model, you give the capital to an intermediary and then receive your profit.
If you have the knowledge and skills to invest, you can use the direct model. On the other hand, if you do not have the expertise and time to do so, it is better to use the indirect method.
Although the risk is lower in the indirect investment model, note that in this method, the rate of return and profit is usually lower.
The most obvious examples of direct and indirect investment can be seen in the stock market and capital markets, which we refer to in investment methods. Expertise and having enough time are the most important factors for choosing one of these two models.
Of course, it goes without saying that investment methods are different in both direct and indirect models, each of which has its own risks.
What is short-term investment?
Paying attention to the time factor is another factor that different investors want. Some of them tend to achieve the expected returns in a short period of time. Others, on the other hand, hope for long-term investment and long-term horizons.
What is long-term investment?
Almost everything we have said about short-term investment is the opposite for the long-term investment model. In this model, investors do not expect much for their early return on cash.
These people have a more strategic view of investing and are not just looking for short-term profits. The model usually involves less risk and the return on investment is more than a year.
However, the rate of return on long-term investment is usually higher than short-term investment. Examples of this type of investment include long-term bank deposits, real estate. There are other methods that we will discuss in the following.