Welcome to InvestmentTheory.com

The term 'Investment' when looked at from an economists point of view means investing in real things such as a house or then a machine but when looked at it from a financial economists point of view, it means investing monetarily, which can be deposited into the bank or then invested in the market. This can be used later at any point of time to purchase a real asset.

Investments vs Savings
If you thought investments and savings were one and the same, then think again. All your investments cane be referred as savings but all your savings can not be investments. There is a vast difference between investments and savings. Savings basically refers to the money that is kept in your bank account without doing anything much to it. The only way the saved amount will increase is when you deposit more cash or then when you earn the quarterly or the half yearly interest from your bank. The savings amount will stay more or less stagnant until you do not deposit some more. Investments, on the other hand, refer to utilizing the saved amount and making more money at a faster rate than the savings. In this light, investments are definitely riskier than just saving the amount as the value of the amount you invest can increase or decrease depending on the rise and fall in the market. But you do have various options when you contemplate investing your saved amount.

Role of An Investment Advisor
Investments are not everyone's ball game and hence, an investment advisor plays an integral part in building your wealth portfolio. If you are not well versed with the investment market and the strategies used by the various investors, then there are very good chances of you losing money instead of making profits on your investments. The competitiveness in the investment market is reaching new heights every other day. You will see a number of investment options. There are the stocks and shares of various companies in the stock market, then there are various mutual funds, bonds, and other equity investments. The options to invest in are not limited and any layman with very little knowledge in the investment market can get thoroughly confused. This is where the investment advisor steps in graciously. By being in the investment market for a long time, the investment advisers have all the possible knowledge. This only proves beneficial to you if you are not very confident about your knowledge in investing.

Different Investment Options
The financial market has been segregated in to a number of markets to differentiate between them. You have the options of investing in the bond market, the stock or the equities market, the forex market, the derivatives market, the commodities market, the spot market, the OTC market, and the real estate market. Each and every financial market is unique in their own right. They have their own share of risks and returns. Some are riskier than the others. For instance, if you invest in a property right now and the real estate rates fall some days after you bought the property, then you will definitely lose out at the moment. But if after a year or two, the real estate prices shoot up, then you can very easily make up for the loss by selling the property. Similarly, all the financial markets do involve risk but the level of risks varies from one financial market to another. In the end it is up to you to decide what kind of risk you would like to take with your hard-earned money.