Savings or investment - Part 2
In my last post I made an introduction to the concept of comparing both savings and investment. In my last post, we were able to look at saving as an entity and look into what we mean by saving.
Today we will be going into the knowledge of investment and looking at what investment really means
While investment,
As the name implies it has to do with the funding creation of another business scheme that would later bring out more income. It can be said t be the opposite of savings because with savings the money saved increases slowly but investment boost the amount in ester rapidly and help create another source of income a way of investment could be through shop openings, or investing in share holding business and stock exchange that would help bring huge amount of profit in the time of good flows.
But investment schemes is said to be full of risk due to the rate of profit being decided by the forces of demand and supply in such organization as they may vary
Income could be in the form of wages and salaries and is also said to be as a form of remuneration being earned by workers or labourers of an organization
So having investment can then be seen as the creation of wealth schemes to help in generating more income or creating of various ways at which income can be earned by investing in resources or shares and business.
##The stock exchange
Income could be maximized by investing in the stock exchange, the stock exchange is said to be a market which exists to bring together those who wish to sell stocks or shares and those who wish to buy them. It is an highly organized capital market.
Essentially, it is a market in which dealings takes place in existing shares but is not a source from which new capital is generated m. That is the reason why it is mostly regarded as a market for old capital. The security markets such as the Nigeria stock exchange (NSE) are financial market place for stock and bonds.
This institution serve two major functions
They assist business in finding long term funding to finance large capital needs such as beginning operation, expanding their businesses or buying major goods and services.
They provide private investors a place to buy and sell investments such as stock, bonds and mutual funds, that can help them build their financial future.
The securities markets are divided into primary and secondary:
Primary market handles the sale of new securities which is an important point to understand because corporations make money on the sale of their securities only once when they are first bought on the primary market.
The initial first offering of a corporation stock is called an initial public offering (IPO).
Secondary market then handles the trading of securities between investors, with the proceeds of a sale going to the investor selling the stock, not to corporations whose stock is sold.
In vividly comparing between savings and investment and choosing which is more reasonable I would slightly prefer investment to savings because no matter wat loss I may observe as the risk is said to happen when investing it cannot be forever the main deal of working is to make more money and not to be keeping for a future that might not be promised but as a lame man I would prefer go both of them by splittting the income in half so to know that no mattter what if I loose my investment my savings would still be increasing even if it’s not rapid but gradually
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