Types of Investments: Investments can be broadly classified into two types - equity and debt. Equity investments include stocks, mutual funds, exchange-traded funds, real estate, and other similar assets that represent ownership in a company or property. Debt investments include bonds, fixed deposits, treasury bills, and other similar assets that represent a loan given to a borrower.
Risk and Return: Every investment comes with a certain level of risk, and the potential for returns is usually directly proportional to the level of risk involved. Higher risk investments, such as stocks, have the potential for higher returns, while lower risk investments, such as bonds, offer lower returns. It is essential to understand the risk-return trade-off and choose investments that align with your risk tolerance and financial goals.