HARVEST INTERNATIONAL | Hicfx.com | Investment Products
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Investment Products

To describe each and every investment product is an almost impossible thing. Humans are creative species, if something is not doing too well, they either modify it or create something else. Its the same with investment products. We are going to see only the general overview of each group of product based on their capital outlay and projected returns.

Time Deposits

This is the most basic form of investment. In general, the public has the notion that time deposits are the most secure form of investments. The interest yield is slightly above the prime rate and there a few choice of time frame, from 3 months to 12 months. Capital outlay is not large but the drawback is that withdrawal prior maturity will set you back with penalty rates. Be very sure that you don’t need to use the money for that period.

Investment Products (Financials)

An investment can come in many forms. Investments can come in various forms; some people are comfortable in property or real estate, some may be interested in business building and some may prefer to invest in people. The products that we are going to dwell here are investments in the financial industry.

  • Shares, stocks,equities

The most common of all investments. Basically, by purchasing shares of a company, you are actually owning a certain percentage of that company. Your returns may come in two forms. First, you’ll be rewarded with dividends annually, when that company makes some profit. If that company fails to make profits, then you will not be rewarded with dividends but you still own the shares. The second way of getting returns, is when the share price increases. Let’s say, you bought 500 shares of company XZY at price of $1.00 per share. Later the price goes up to $1.20 per share. Your profit will be ($0.20×500=$100.00) when you sell you shares. Your risks will are the stability of the company. If the company fails to make profit, you don’t get dividend. When the company performs badly, the share price goes down, so will be your shares value.

  • Bonds, fixed-income securities

These are slightly less risky, but also less returns. Bonds are basically a loan made to an institution with a promised payback of a certain percent after a fixed period of time. The payback is also known as yield and yields are only slightly more than fixed deposits. Usually soveriegn institutions offer bonds with maturity ranging from 10-30 years. Not too long ago, some governments issue a shorter period, 5 years, these are known as junk bonds. History has taught us that only governments have the ability to issue bonds and the private sector can only issue fixed-income securities. So, presently, only private  financial institutions with deep pockets can offer fixed-income securities.

  • Mutual Funds

Slightly better returns than shares and bonds but with slightly less risk. Mutual funds are managed by fund managers, usually institutions like finance houses, banks and even insurance companies. The fund managers will offer a certain fund to the general public with a proposed yield, through a prospectus. The prospectus will provide information on where the money will be invested, so the risk is spread among a broader spectrum and the past performance of that funds. The funny thing is, if you can read the fine print, it will usually say something similar to this ; “The past performance may not be the same as the future performance.”

  • Futures

The first 3 products are basically passive investment, meaning, after you invest (putting in your money) you simply wait and pray that you investment will reap rewards over time. Futures is totally different; its active investment. If you don’t have the time, then find yourself a broker who can trade your futures account. The most beautiful aspect about trading futures is; 2-way opportunity. Profits can be made both ways, ie; when the price is climbing up, or when the price is sliding down. Please see our section on Futures Trading.