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Snippet from Wikipedia: Investment

To invest is to allocate money in the expectation of some benefit in the future.

In finance, the benefit from an investment is called a return. The return may consist of a gain (or loss) realised from the sale of a property or an investment, unrealised capital appreciation (or depreciation), or investment income such as dividends, interest, rental income etc., or a combination of capital gain and income. The return may also include currency gains or losses due to changes in the foreign currency exchange rates.

Investors generally expect higher returns from riskier their investments. When a low risk investment is made, the return is also generally low. Similarly, high risk comes with high returns.

Investors, particularly novices, are often advised to adopt a particular investment strategy and diversify their portfolio. Diversification has the statistical effect of reducing overall risk.

Investment, in a financial sense, is something that one puts money into in hopes of receiving a profit or gain. In an economic sense, an investment is something purchased that is not a consumer good, but is used for production of other goods and services. A type of financial investment is the purchase of a security, such as a stock or bond. Economic investments can be physical, such as machinery for a factory, or intangible, such as investing in job training to create human capital.

An investment is an object, mechanism, or system which is purchased with money or into which money is placed with the goal or receiving something greater in return.

Common Financial Investments

Common Investments in Survivalism

Quotes

C.S. Lewis wrote: :Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber baron]]s than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. ://www.tsowell.com/quotes.html

Incremental Gun-Grabbing of the Nanny State

Liberals and socialists support “common sense” measures - a “good first step” of the Nanny State. To a citizen-prepper-patriot and to the Bill of Rights, this is “death by a thousand paper cuts”.

This Second Amendment Foundation video is the formal response to Hollywood's Demand a Plan gun-grabbing propaganda video. The video shows one of the main differences between liberal gun control Nanny states (Blue states) and conservative and/or libertarian Second Amendment-supporting “free states” (Red states). This video shows why we vote with our feet:

Snippet from Wikipedia: Investment

To invest is to allocate money in the expectation of some benefit in the future.

In finance, the benefit from an investment is called a return. The return may consist of a gain (or loss) realised from the sale of a property or an investment, unrealised capital appreciation (or depreciation), or investment income such as dividends, interest, rental income etc., or a combination of capital gain and income. The return may also include currency gains or losses due to changes in the foreign currency exchange rates.

Investors generally expect higher returns from riskier their investments. When a low risk investment is made, the return is also generally low. Similarly, high risk comes with high returns.

Investors, particularly novices, are often advised to adopt a particular investment strategy and diversify their portfolio. Diversification has the statistical effect of reducing overall risk.

Investment, in a financial sense, is something that one puts money into in hopes of receiving a profit or gain. In an economic sense, an investment is something purchased that is not a consumer good, but is used for production of other goods and services. A type of financial investment is the purchase of a security, such as a stock or bond. Economic investments can be physical, such as machinery for a factory, or intangible, such as investing in job training to create human capital.

An investment is an object, mechanism, or system which is purchased with money or into which money is placed with the goal or receiving something greater in return.

Common Financial Investments

Common Investments in Survivalism

Quotes

C.S. Lewis wrote: :Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber baron]]s than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. ://www.tsowell.com/quotes.html

Incremental Gun-Grabbing of the Nanny State

Liberals and socialists support “common sense” measures - a “good first step” of the Nanny State. To a citizen-prepper-patriot and to the Bill of Rights, this is “death by a thousand paper cuts”.

This Second Amendment Foundation video is the formal response to Hollywood's Demand a Plan gun-grabbing propaganda video. The video shows one of the main differences between liberal gun control Nanny states (Blue states) and conservative and/or libertarian Second Amendment-supporting “free states” (Red states). This video shows why we vote with our feet:

Snippet from Wikipedia: Investment

To invest is to allocate money in the expectation of some benefit in the future.

In finance, the benefit from an investment is called a return. The return may consist of a gain (or loss) realised from the sale of a property or an investment, unrealised capital appreciation (or depreciation), or investment income such as dividends, interest, rental income etc., or a combination of capital gain and income. The return may also include currency gains or losses due to changes in the foreign currency exchange rates.

Investors generally expect higher returns from riskier their investments. When a low risk investment is made, the return is also generally low. Similarly, high risk comes with high returns.

Investors, particularly novices, are often advised to adopt a particular investment strategy and diversify their portfolio. Diversification has the statistical effect of reducing overall risk.

Investment, in a financial sense, is something that one puts money into in hopes of receiving a profit or gain. In an economic sense, an investment is something purchased that is not a consumer good, but is used for production of other goods and services. A type of financial investment is the purchase of a security, such as a stock or bond. Economic investments can be physical, such as machinery for a factory, or intangible, such as investing in job training to create human capital.

An investment is an object, mechanism, or system which is purchased with money or into which money is placed with the goal or receiving something greater in return.

Common Financial Investments

Common Investments in Survivalism

Quotes

C.S. Lewis wrote: :Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber baron]]s than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. ://www.tsowell.com/quotes.html

Incremental Gun-Grabbing of the Nanny State

Liberals and socialists support “common sense” measures - a “good first step” of the Nanny State. To a citizen-prepper-patriot and to the Bill of Rights, this is “death by a thousand paper cuts”.

This Second Amendment Foundation video is the formal response to Hollywood's Demand a Plan gun-grabbing propaganda video. The video shows one of the main differences between liberal gun control Nanny states (Blue states) and conservative and/or libertarian Second Amendment-supporting “free states” (Red states). This video shows why we vote with our feet:

If I Wanted to Save America

Jack Spirko of the Survival Podcast responded to a shocking video called “If I Wanted America to fail”.<ref>“If I wanted America to fail”, Published FreeMarketAmerica (http://FreeMarketAmerica.org) on Apr 20, 2012. https://www.youtube.com/watch?v=CZ-4gnNz0vc. Discusses Global warming carbon credit, environmental movement, Public school culture liberal values, socialist Big government-Nanny state-Police state of Obamanomics-Obamunism Accessed April 9, 2014</ref>

Snippet from Wikipedia: Investment

To invest is to allocate money in the expectation of some benefit in the future.

In finance, the benefit from an investment is called a return. The return may consist of a gain (or loss) realised from the sale of a property or an investment, unrealised capital appreciation (or depreciation), or investment income such as dividends, interest, rental income etc., or a combination of capital gain and income. The return may also include currency gains or losses due to changes in the foreign currency exchange rates.

Investors generally expect higher returns from riskier their investments. When a low risk investment is made, the return is also generally low. Similarly, high risk comes with high returns.

Investors, particularly novices, are often advised to adopt a particular investment strategy and diversify their portfolio. Diversification has the statistical effect of reducing overall risk.

Investment, in a financial sense, is something that one puts money into in hopes of receiving a profit or gain. In an economic sense, an investment is something purchased that is not a consumer good, but is used for production of other goods and services. A type of financial investment is the purchase of a security, such as a stock or bond. Economic investments can be physical, such as machinery for a factory, or intangible, such as investing in job training to create human capital.

An investment is an object, mechanism, or system which is purchased with money or into which money is placed with the goal or receiving something greater in return.

Common Financial Investments

Common Investments in Survivalism

Quotes

C.S. Lewis wrote: :Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber baron]]s than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. ://www.tsowell.com/quotes.html

Incremental Gun-Grabbing of the Nanny State

Liberals and socialists support “common sense” measures - a “good first step” of the Nanny State. To a citizen-prepper-patriot and to the Bill of Rights, this is “death by a thousand paper cuts”.

This Second Amendment Foundation video is the formal response to Hollywood's Demand a Plan gun-grabbing propaganda video. The video shows one of the main differences between liberal gun control Nanny states (Blue states) and conservative and/or libertarian Second Amendment-supporting “free states” (Red states). This video shows why we vote with our feet:

Snippet from Wikipedia: Investment

To invest is to allocate money in the expectation of some benefit in the future.

In finance, the benefit from an investment is called a return. The return may consist of a gain (or loss) realised from the sale of a property or an investment, unrealised capital appreciation (or depreciation), or investment income such as dividends, interest, rental income etc., or a combination of capital gain and income. The return may also include currency gains or losses due to changes in the foreign currency exchange rates.

Investors generally expect higher returns from riskier their investments. When a low risk investment is made, the return is also generally low. Similarly, high risk comes with high returns.

Investors, particularly novices, are often advised to adopt a particular investment strategy and diversify their portfolio. Diversification has the statistical effect of reducing overall risk.

Investment, in a financial sense, is something that one puts money into in hopes of receiving a profit or gain. In an economic sense, an investment is something purchased that is not a consumer good, but is used for production of other goods and services. A type of financial investment is the purchase of a security, such as a stock or bond. Economic investments can be physical, such as machinery for a factory, or intangible, such as investing in job training to create human capital.

An investment is an object, mechanism, or system which is purchased with money or into which money is placed with the goal or receiving something greater in return.

Common Financial Investments

Common Investments in Survivalism

Quotes

C.S. Lewis wrote: :Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber baron]]s than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. ://www.tsowell.com/quotes.html

Incremental Gun-Grabbing of the Nanny State

Liberals and socialists support “common sense” measures - a “good first step” of the Nanny State. To a citizen-prepper-patriot and to the Bill of Rights, this is “death by a thousand paper cuts”.

This Second Amendment Foundation video is the formal response to Hollywood's Demand a Plan gun-grabbing propaganda video. The video shows one of the main differences between liberal gun control Nanny states (Blue states) and conservative and/or libertarian Second Amendment-supporting “free states” (Red states). This video shows why we vote with our feet:

If I Wanted to Save America

Jack Spirko of the Survival Podcast responded to a shocking video called “If I Wanted America to fail”.<ref>“If I wanted America to fail”, Published FreeMarketAmerica (http://FreeMarketAmerica.org) on Apr 20, 2012. https://www.youtube.com/watch?v=CZ-4gnNz0vc. Discusses Global warming carbon credit, environmental movement, Public school culture liberal values, socialist Big government-Nanny state-Police state of Obamanomics-Obamunism Accessed April 9, 2014</ref>

Snippet from Wikipedia: Investment

To invest is to allocate money in the expectation of some benefit in the future.

In finance, the benefit from an investment is called a return. The return may consist of a gain (or loss) realised from the sale of a property or an investment, unrealised capital appreciation (or depreciation), or investment income such as dividends, interest, rental income etc., or a combination of capital gain and income. The return may also include currency gains or losses due to changes in the foreign currency exchange rates.

Investors generally expect higher returns from riskier their investments. When a low risk investment is made, the return is also generally low. Similarly, high risk comes with high returns.

Investors, particularly novices, are often advised to adopt a particular investment strategy and diversify their portfolio. Diversification has the statistical effect of reducing overall risk.

Investment, in a financial sense, is something that one puts money into in hopes of receiving a profit or gain. In an economic sense, an investment is something purchased that is not a consumer good, but is used for production of other goods and services. A type of financial investment is the purchase of a security, such as a stock or bond. Economic investments can be physical, such as machinery for a factory, or intangible, such as investing in job training to create human capital.

An investment is an object, mechanism, or system which is purchased with money or into which money is placed with the goal or receiving something greater in return.

Common Financial Investments

Common Investments in Survivalism

Quotes

C.S. Lewis wrote: :Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber baron]]s than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. ://www.tsowell.com/quotes.html

Incremental Gun-Grabbing of the Nanny State

Liberals and socialists support “common sense” measures - a “good first step” of the Nanny State. To a citizen-prepper-patriot and to the Bill of Rights, this is “death by a thousand paper cuts”.

This Second Amendment Foundation video is the formal response to Hollywood's Demand a Plan gun-grabbing propaganda video. The video shows one of the main differences between liberal gun control Nanny states (Blue states) and conservative and/or libertarian Second Amendment-supporting “free states” (Red states). This video shows why we vote with our feet:

See Also

versus:

References

References

Finance Business Economics


Investment has different meanings in finance and economics.

In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories.

In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.

In economics or macroeconomics

In economic theory or in macroeconomics, non-residential fixed investment is the amount purchased per unit time of goods which are not consumed but are to be used for future production (i.e. capital). Examples include railroad or factory construction. Investment in human capital includes costs of additional schooling or on-the-job training. Inventory investment is the accumulation of goods inventories; it can be positive or negative, and it can be intended or unintended. In measures of national income and output, “gross investment” ( represented by the variable <var style=“font-family: serif; font-size: 1.1em;”>I</var> ) is a component of gross domestic product (<var>GDP</var>), given in the formula <var>GDP</var> = <var>C</var> + <var style=“font-family: serif; font-size: 1.1em;”>I</var> + <var>G</var> + <var>NX</var>, where <var>C</var> is consumption, <var>G</var> is government spending, and <var>NX</var> is net exports, given by the difference between the exports and imports, <var>X</var> − <var>M</var>. Thus investment is everything that remains of total expenditure after consumption, government spending, and net exports are subtracted (i.e. <var>I</var> = <var>GDP</var> − <var style=“font-family: serif; font-size: 1.1em;”>C</var> − <var>G</var> − <var>NX</var>).

Non-residential fixed investment (such as new factories) and residential investment (new houses) combine with inventory investment to make up <var style=“font-family: serif; font-size: 1.1em;”>I</var>. “Net investment” deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.

Fixed investment, as expenditure over a period of time (e.g., “per year”), is not capital but rather leads to changes in the amount of capital. The time dimension of investment makes it a flow. By contrast, capital is a stock— that is, accumulated net investment to a point in time (such as December 31).

Investment is often modeled as a function of income and interest rates, given by the relation <var style=“font-family: serif; font-size: 1.1em;”>I</var> = <var>f</var>(<var>Y</var>, <var>r</var>). An increase in income encourages higher investment, whereas a higher interest rate may discourage investment as it becomes more costly to borrow money. Even if a firm chooses to use its own funds in an investment, the interest rate represents an opportunity cost of investing those funds rather than lending out that amount of money for interest.<ref>

</ref>

In finance

In finance, investment is the purchase of an asset or item with the hope that it will generate income or appreciate in the future and be sold at the higher price.<ref>

</ref> It generally does not include deposits with a bank or similar institution. The term investment is usually used when referring to a long-term outlook. This is the opposite of trading or speculation, which are short-term practices involving a much higher degree of risk. Financial assets take many forms and can range from the ultra safe low return government bonds to much higher risk higher reward international stocks. A good investment strategy will diversify the portfolio according to the specified needs. The most famous and successful investor of all time is Warren Buffett. In March 2013 Forbes magazine had Warren Buffett ranked as number 2 in their Forbes 400 list.<ref>

</ref> Buffett has advised in numerous articles and interviews that a good investment strategy is long term and choosing the right assets to invest in requires due diligence. Edward O. Thorp was a very successful hedge fund manager in the 1970s and 1980s that spoke of a similar approach.<ref>

</ref> Another thing they both have in common is a similar approach to managing investment money. No matter how successful the fundamental pick is, without a proper money management strategy, full potential of the asset can’t be reached. Both investors have been shown to use principles from the Kelly criterion for money management.<ref>

</ref> Numerous interactive calculators which use the kelly criterion can be found online.<ref>

</ref>

In contrast, dollar (or pound etc.) cost averaging and market timing are phrases often used in marketing of collective investments and can be said to be associated with speculation.

Investments are often made indirectly through intermediaries, such as pension funds, banks, brokers, and insurance companies. These institutions may pool money received from a large number of individuals into funds such as investment trusts, unit trusts, SICAVs etc. to make large scale investments. Each individual investor then has an indirect or direct claim on the assets purchased, subject to charges levied by the intermediary, which may be large and varied. It generally, does not include deposits with a bank or similar institution. Investment usually involves diversification of assets in order to avoid unnecessary and unproductive risk.

History

The Code of Hammurabi (around 1700 BC) provided a legal framework for investment, establishing a means for the pledge of collateral by codifying debtor and creditor rights in regard to pledged land. Punishments for breaking financial obligations were not as severe as those for crimes involving injury or death.

In the early 1900s purchasers of stocks, bonds, and other securities were described in media, academia, and commerce as speculators. By the 1950s, the term investment had come to denote the more conversative end of the securities spectrum, while speculation was applied by financial brokers and their advertising agencies to higher risk securities much in vogue at that time. Since the last half of the 20th century, the terms speculation and speculator have specifically referred to higher risk ventures.

Types of investment

Types of investments include:

See also

References

External links

Jack answered with his podcast on “If I Wanted to Save America” (http://www.thesurvivalpodcast.com/help-spread-the-word-and-share-if-i-wanted-to-save-america):

.

<ref>https://www.youtube.com/watch?v=m-YbjhpL49c</ref>

<ref>https://www.youtube.com/watch?v=na5OMdHip-g</ref>

For one's long-term survival from the Police state and the Nanny State, Jack Spirko created Walking to Freedom — an initiative by where citizens are encouraged to pull up stakes and to move to a more open and free state – to vote with their feet.

See Also

References

<references/>

External Links

Visual representations of Jack Spirko's “If I Wanted To Save America” Survival Podcast speech in answer to the above YouTube video “If I Wanted America To Fail”:

Find the corresponding Survival Podcast episode

Relevant TSP Episodes

See Also

versus:

References

References

External Links

Finance Business Economics


Investment has different meanings in finance and economics.

In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories.

In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.

In economics or macroeconomics

In economic theory or in macroeconomics, non-residential fixed investment is the amount purchased per unit time of goods which are not consumed but are to be used for future production (i.e. capital). Examples include railroad or factory construction. Investment in human capital includes costs of additional schooling or on-the-job training. Inventory investment is the accumulation of goods inventories; it can be positive or negative, and it can be intended or unintended. In measures of national income and output, “gross investment” ( represented by the variable <var style=“font-family: serif; font-size: 1.1em;”>I</var> ) is a component of gross domestic product (<var>GDP</var>), given in the formula <var>GDP</var> = <var>C</var> + <var style=“font-family: serif; font-size: 1.1em;”>I</var> + <var>G</var> + <var>NX</var>, where <var>C</var> is consumption, <var>G</var> is government spending, and <var>NX</var> is net exports, given by the difference between the exports and imports, <var>X</var> − <var>M</var>. Thus investment is everything that remains of total expenditure after consumption, government spending, and net exports are subtracted (i.e. <var>I</var> = <var>GDP</var> − <var style=“font-family: serif; font-size: 1.1em;”>C</var> − <var>G</var> − <var>NX</var>).

Non-residential fixed investment (such as new factories) and residential investment (new houses) combine with inventory investment to make up <var style=“font-family: serif; font-size: 1.1em;”>I</var>. “Net investment” deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.

Fixed investment, as expenditure over a period of time (e.g., “per year”), is not capital but rather leads to changes in the amount of capital. The time dimension of investment makes it a flow. By contrast, capital is a stock— that is, accumulated net investment to a point in time (such as December 31).

Investment is often modeled as a function of income and interest rates, given by the relation <var style=“font-family: serif; font-size: 1.1em;”>I</var> = <var>f</var>(<var>Y</var>, <var>r</var>). An increase in income encourages higher investment, whereas a higher interest rate may discourage investment as it becomes more costly to borrow money. Even if a firm chooses to use its own funds in an investment, the interest rate represents an opportunity cost of investing those funds rather than lending out that amount of money for interest.<ref>

</ref>

In finance

In finance, investment is the purchase of an asset or item with the hope that it will generate income or appreciate in the future and be sold at the higher price.<ref>

</ref> It generally does not include deposits with a bank or similar institution. The term investment is usually used when referring to a long-term outlook. This is the opposite of trading or speculation, which are short-term practices involving a much higher degree of risk. Financial assets take many forms and can range from the ultra safe low return government bonds to much higher risk higher reward international stocks. A good investment strategy will diversify the portfolio according to the specified needs. The most famous and successful investor of all time is Warren Buffett. In March 2013 Forbes magazine had Warren Buffett ranked as number 2 in their Forbes 400 list.<ref>

</ref> Buffett has advised in numerous articles and interviews that a good investment strategy is long term and choosing the right assets to invest in requires due diligence. Edward O. Thorp was a very successful hedge fund manager in the 1970s and 1980s that spoke of a similar approach.<ref>

</ref> Another thing they both have in common is a similar approach to managing investment money. No matter how successful the fundamental pick is, without a proper money management strategy, full potential of the asset can’t be reached. Both investors have been shown to use principles from the Kelly criterion for money management.<ref>

</ref> Numerous interactive calculators which use the kelly criterion can be found online.<ref>

</ref>

In contrast, dollar (or pound etc.) cost averaging and market timing are phrases often used in marketing of collective investments and can be said to be associated with speculation.

Investments are often made indirectly through intermediaries, such as pension funds, banks, brokers, and insurance companies. These institutions may pool money received from a large number of individuals into funds such as investment trusts, unit trusts, SICAVs etc. to make large scale investments. Each individual investor then has an indirect or direct claim on the assets purchased, subject to charges levied by the intermediary, which may be large and varied. It generally, does not include deposits with a bank or similar institution. Investment usually involves diversification of assets in order to avoid unnecessary and unproductive risk.

History

The Code of Hammurabi (around 1700 BC) provided a legal framework for investment, establishing a means for the pledge of collateral by codifying debtor and creditor rights in regard to pledged land. Punishments for breaking financial obligations were not as severe as those for crimes involving injury or death.

In the early 1900s purchasers of stocks, bonds, and other securities were described in media, academia, and commerce as speculators. By the 1950s, the term investment had come to denote the more conversative end of the securities spectrum, while speculation was applied by financial brokers and their advertising agencies to higher risk securities much in vogue at that time. Since the last half of the 20th century, the terms speculation and speculator have specifically referred to higher risk ventures.

Types of investment

Types of investments include:

See also

References

External links

See Also

versus:

References

References

External Links

Finance Business Economics


Investment has different meanings in finance and economics.

In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories.

In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.

In economics or macroeconomics

In economic theory or in macroeconomics, non-residential fixed investment is the amount purchased per unit time of goods which are not consumed but are to be used for future production (i.e. capital). Examples include railroad or factory construction. Investment in human capital includes costs of additional schooling or on-the-job training. Inventory investment is the accumulation of goods inventories; it can be positive or negative, and it can be intended or unintended. In measures of national income and output, “gross investment” ( represented by the variable <var style=“font-family: serif; font-size: 1.1em;”>I</var> ) is a component of gross domestic product (<var>GDP</var>), given in the formula <var>GDP</var> = <var>C</var> + <var style=“font-family: serif; font-size: 1.1em;”>I</var> + <var>G</var> + <var>NX</var>, where <var>C</var> is consumption, <var>G</var> is government spending, and <var>NX</var> is net exports, given by the difference between the exports and imports, <var>X</var> − <var>M</var>. Thus investment is everything that remains of total expenditure after consumption, government spending, and net exports are subtracted (i.e. <var>I</var> = <var>GDP</var> − <var style=“font-family: serif; font-size: 1.1em;”>C</var> − <var>G</var> − <var>NX</var>).

Non-residential fixed investment (such as new factories) and residential investment (new houses) combine with inventory investment to make up <var style=“font-family: serif; font-size: 1.1em;”>I</var>. “Net investment” deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.

Fixed investment, as expenditure over a period of time (e.g., “per year”), is not capital but rather leads to changes in the amount of capital. The time dimension of investment makes it a flow. By contrast, capital is a stock— that is, accumulated net investment to a point in time (such as December 31).

Investment is often modeled as a function of income and interest rates, given by the relation <var style=“font-family: serif; font-size: 1.1em;”>I</var> = <var>f</var>(<var>Y</var>, <var>r</var>). An increase in income encourages higher investment, whereas a higher interest rate may discourage investment as it becomes more costly to borrow money. Even if a firm chooses to use its own funds in an investment, the interest rate represents an opportunity cost of investing those funds rather than lending out that amount of money for interest.<ref>

</ref>

In finance

In finance, investment is the purchase of an asset or item with the hope that it will generate income or appreciate in the future and be sold at the higher price.<ref>

</ref> It generally does not include deposits with a bank or similar institution. The term investment is usually used when referring to a long-term outlook. This is the opposite of trading or speculation, which are short-term practices involving a much higher degree of risk. Financial assets take many forms and can range from the ultra safe low return government bonds to much higher risk higher reward international stocks. A good investment strategy will diversify the portfolio according to the specified needs. The most famous and successful investor of all time is Warren Buffett. In March 2013 Forbes magazine had Warren Buffett ranked as number 2 in their Forbes 400 list.<ref>

</ref> Buffett has advised in numerous articles and interviews that a good investment strategy is long term and choosing the right assets to invest in requires due diligence. Edward O. Thorp was a very successful hedge fund manager in the 1970s and 1980s that spoke of a similar approach.<ref>

</ref> Another thing they both have in common is a similar approach to managing investment money. No matter how successful the fundamental pick is, without a proper money management strategy, full potential of the asset can’t be reached. Both investors have been shown to use principles from the Kelly criterion for money management.<ref>

</ref> Numerous interactive calculators which use the kelly criterion can be found online.<ref>

</ref>

In contrast, dollar (or pound etc.) cost averaging and market timing are phrases often used in marketing of collective investments and can be said to be associated with speculation.

Investments are often made indirectly through intermediaries, such as pension funds, banks, brokers, and insurance companies. These institutions may pool money received from a large number of individuals into funds such as investment trusts, unit trusts, SICAVs etc. to make large scale investments. Each individual investor then has an indirect or direct claim on the assets purchased, subject to charges levied by the intermediary, which may be large and varied. It generally, does not include deposits with a bank or similar institution. Investment usually involves diversification of assets in order to avoid unnecessary and unproductive risk.

History

The Code of Hammurabi (around 1700 BC) provided a legal framework for investment, establishing a means for the pledge of collateral by codifying debtor and creditor rights in regard to pledged land. Punishments for breaking financial obligations were not as severe as those for crimes involving injury or death.

In the early 1900s purchasers of stocks, bonds, and other securities were described in media, academia, and commerce as speculators. By the 1950s, the term investment had come to denote the more conversative end of the securities spectrum, while speculation was applied by financial brokers and their advertising agencies to higher risk securities much in vogue at that time. Since the last half of the 20th century, the terms speculation and speculator have specifically referred to higher risk ventures.

Types of investment

Types of investments include:

See also

References

External links

Jack answered with his podcast on “If I Wanted to Save America” (http://www.thesurvivalpodcast.com/help-spread-the-word-and-share-if-i-wanted-to-save-america):

.

<ref>https://www.youtube.com/watch?v=m-YbjhpL49c</ref>

<ref>https://www.youtube.com/watch?v=na5OMdHip-g</ref>

For one's long-term survival from the Police state and the Nanny State, Jack Spirko created Walking to Freedom — an initiative by where citizens are encouraged to pull up stakes and to move to a more open and free state – to vote with their feet.

See Also

References

<references/>

External Links

Visual representations of Jack Spirko's “If I Wanted To Save America” Survival Podcast speech in answer to the above YouTube video “If I Wanted America To Fail”:

Find the corresponding Survival Podcast episode

Relevant TSP Episodes

If I Wanted to Save America

Jack Spirko of the Survival Podcast responded to a shocking video called “If I Wanted America to fail”.<ref>“If I wanted America to fail”, Published FreeMarketAmerica (http://FreeMarketAmerica.org) on Apr 20, 2012. https://www.youtube.com/watch?v=CZ-4gnNz0vc. Discusses Global warming carbon credit, environmental movement, Public school culture liberal values, socialist Big government-Nanny state-Police state of Obamanomics-Obamunism Accessed April 9, 2014</ref>

Snippet from Wikipedia: Investment

To invest is to allocate money in the expectation of some benefit in the future.

In finance, the benefit from an investment is called a return. The return may consist of a gain (or loss) realised from the sale of a property or an investment, unrealised capital appreciation (or depreciation), or investment income such as dividends, interest, rental income etc., or a combination of capital gain and income. The return may also include currency gains or losses due to changes in the foreign currency exchange rates.

Investors generally expect higher returns from riskier their investments. When a low risk investment is made, the return is also generally low. Similarly, high risk comes with high returns.

Investors, particularly novices, are often advised to adopt a particular investment strategy and diversify their portfolio. Diversification has the statistical effect of reducing overall risk.

Investment, in a financial sense, is something that one puts money into in hopes of receiving a profit or gain. In an economic sense, an investment is something purchased that is not a consumer good, but is used for production of other goods and services. A type of financial investment is the purchase of a security, such as a stock or bond. Economic investments can be physical, such as machinery for a factory, or intangible, such as investing in job training to create human capital.

An investment is an object, mechanism, or system which is purchased with money or into which money is placed with the goal or receiving something greater in return.

Common Financial Investments

Common Investments in Survivalism

Quotes

C.S. Lewis wrote: :Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber baron]]s than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. ://www.tsowell.com/quotes.html

Incremental Gun-Grabbing of the Nanny State

Liberals and socialists support “common sense” measures - a “good first step” of the Nanny State. To a citizen-prepper-patriot and to the Bill of Rights, this is “death by a thousand paper cuts”.

This Second Amendment Foundation video is the formal response to Hollywood's Demand a Plan gun-grabbing propaganda video. The video shows one of the main differences between liberal gun control Nanny states (Blue states) and conservative and/or libertarian Second Amendment-supporting “free states” (Red states). This video shows why we vote with our feet:

See Also

versus:

References

References

External Links

Finance Business Economics


Investment has different meanings in finance and economics.

In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories.

In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.

In economics or macroeconomics

In economic theory or in macroeconomics, non-residential fixed investment is the amount purchased per unit time of goods which are not consumed but are to be used for future production (i.e. capital). Examples include railroad or factory construction. Investment in human capital includes costs of additional schooling or on-the-job training. Inventory investment is the accumulation of goods inventories; it can be positive or negative, and it can be intended or unintended. In measures of national income and output, “gross investment” ( represented by the variable <var style=“font-family: serif; font-size: 1.1em;”>I</var> ) is a component of gross domestic product (<var>GDP</var>), given in the formula <var>GDP</var> = <var>C</var> + <var style=“font-family: serif; font-size: 1.1em;”>I</var> + <var>G</var> + <var>NX</var>, where <var>C</var> is consumption, <var>G</var> is government spending, and <var>NX</var> is net exports, given by the difference between the exports and imports, <var>X</var> − <var>M</var>. Thus investment is everything that remains of total expenditure after consumption, government spending, and net exports are subtracted (i.e. <var>I</var> = <var>GDP</var> − <var style=“font-family: serif; font-size: 1.1em;”>C</var> − <var>G</var> − <var>NX</var>).

Non-residential fixed investment (such as new factories) and residential investment (new houses) combine with inventory investment to make up <var style=“font-family: serif; font-size: 1.1em;”>I</var>. “Net investment” deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.

Fixed investment, as expenditure over a period of time (e.g., “per year”), is not capital but rather leads to changes in the amount of capital. The time dimension of investment makes it a flow. By contrast, capital is a stock— that is, accumulated net investment to a point in time (such as December 31).

Investment is often modeled as a function of income and interest rates, given by the relation <var style=“font-family: serif; font-size: 1.1em;”>I</var> = <var>f</var>(<var>Y</var>, <var>r</var>). An increase in income encourages higher investment, whereas a higher interest rate may discourage investment as it becomes more costly to borrow money. Even if a firm chooses to use its own funds in an investment, the interest rate represents an opportunity cost of investing those funds rather than lending out that amount of money for interest.<ref>

</ref>

In finance

In finance, investment is the purchase of an asset or item with the hope that it will generate income or appreciate in the future and be sold at the higher price.<ref>

</ref> It generally does not include deposits with a bank or similar institution. The term investment is usually used when referring to a long-term outlook. This is the opposite of trading or speculation, which are short-term practices involving a much higher degree of risk. Financial assets take many forms and can range from the ultra safe low return government bonds to much higher risk higher reward international stocks. A good investment strategy will diversify the portfolio according to the specified needs. The most famous and successful investor of all time is Warren Buffett. In March 2013 Forbes magazine had Warren Buffett ranked as number 2 in their Forbes 400 list.<ref>

</ref> Buffett has advised in numerous articles and interviews that a good investment strategy is long term and choosing the right assets to invest in requires due diligence. Edward O. Thorp was a very successful hedge fund manager in the 1970s and 1980s that spoke of a similar approach.<ref>

</ref> Another thing they both have in common is a similar approach to managing investment money. No matter how successful the fundamental pick is, without a proper money management strategy, full potential of the asset can’t be reached. Both investors have been shown to use principles from the Kelly criterion for money management.<ref>

</ref> Numerous interactive calculators which use the kelly criterion can be found online.<ref>

</ref>

In contrast, dollar (or pound etc.) cost averaging and market timing are phrases often used in marketing of collective investments and can be said to be associated with speculation.

Investments are often made indirectly through intermediaries, such as pension funds, banks, brokers, and insurance companies. These institutions may pool money received from a large number of individuals into funds such as investment trusts, unit trusts, SICAVs etc. to make large scale investments. Each individual investor then has an indirect or direct claim on the assets purchased, subject to charges levied by the intermediary, which may be large and varied. It generally, does not include deposits with a bank or similar institution. Investment usually involves diversification of assets in order to avoid unnecessary and unproductive risk.

History

The Code of Hammurabi (around 1700 BC) provided a legal framework for investment, establishing a means for the pledge of collateral by codifying debtor and creditor rights in regard to pledged land. Punishments for breaking financial obligations were not as severe as those for crimes involving injury or death.

In the early 1900s purchasers of stocks, bonds, and other securities were described in media, academia, and commerce as speculators. By the 1950s, the term investment had come to denote the more conversative end of the securities spectrum, while speculation was applied by financial brokers and their advertising agencies to higher risk securities much in vogue at that time. Since the last half of the 20th century, the terms speculation and speculator have specifically referred to higher risk ventures.

Types of investment

Types of investments include:

See also

References

External links

Jack answered with his podcast on “If I Wanted to Save America” (http://www.thesurvivalpodcast.com/help-spread-the-word-and-share-if-i-wanted-to-save-america):

.

<ref>https://www.youtube.com/watch?v=m-YbjhpL49c</ref>

<ref>https://www.youtube.com/watch?v=na5OMdHip-g</ref>

For one's long-term survival from the Police state and the Nanny State, Jack Spirko created Walking to Freedom — an initiative by where citizens are encouraged to pull up stakes and to move to a more open and free state – to vote with their feet.

See Also

References

<references/>

External Links

Visual representations of Jack Spirko's “If I Wanted To Save America” Survival Podcast speech in answer to the above YouTube video “If I Wanted America To Fail”:

Find the corresponding Survival Podcast episode

Relevant TSP Episodes

See Also

versus:

References

References

External Links

Finance Business Economics


Investment has different meanings in finance and economics.

In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories.

In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.

In economics or macroeconomics

In economic theory or in macroeconomics, non-residential fixed investment is the amount purchased per unit time of goods which are not consumed but are to be used for future production (i.e. capital). Examples include railroad or factory construction. Investment in human capital includes costs of additional schooling or on-the-job training. Inventory investment is the accumulation of goods inventories; it can be positive or negative, and it can be intended or unintended. In measures of national income and output, “gross investment” ( represented by the variable <var style=“font-family: serif; font-size: 1.1em;”>I</var> ) is a component of gross domestic product (<var>GDP</var>), given in the formula <var>GDP</var> = <var>C</var> + <var style=“font-family: serif; font-size: 1.1em;”>I</var> + <var>G</var> + <var>NX</var>, where <var>C</var> is consumption, <var>G</var> is government spending, and <var>NX</var> is net exports, given by the difference between the exports and imports, <var>X</var> − <var>M</var>. Thus investment is everything that remains of total expenditure after consumption, government spending, and net exports are subtracted (i.e. <var>I</var> = <var>GDP</var> − <var style=“font-family: serif; font-size: 1.1em;”>C</var> − <var>G</var> − <var>NX</var>).

Non-residential fixed investment (such as new factories) and residential investment (new houses) combine with inventory investment to make up <var style=“font-family: serif; font-size: 1.1em;”>I</var>. “Net investment” deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.

Fixed investment, as expenditure over a period of time (e.g., “per year”), is not capital but rather leads to changes in the amount of capital. The time dimension of investment makes it a flow. By contrast, capital is a stock— that is, accumulated net investment to a point in time (such as December 31).

Investment is often modeled as a function of income and interest rates, given by the relation <var style=“font-family: serif; font-size: 1.1em;”>I</var> = <var>f</var>(<var>Y</var>, <var>r</var>). An increase in income encourages higher investment, whereas a higher interest rate may discourage investment as it becomes more costly to borrow money. Even if a firm chooses to use its own funds in an investment, the interest rate represents an opportunity cost of investing those funds rather than lending out that amount of money for interest.<ref>

</ref>

In finance

In finance, investment is the purchase of an asset or item with the hope that it will generate income or appreciate in the future and be sold at the higher price.<ref>

</ref> It generally does not include deposits with a bank or similar institution. The term investment is usually used when referring to a long-term outlook. This is the opposite of trading or speculation, which are short-term practices involving a much higher degree of risk. Financial assets take many forms and can range from the ultra safe low return government bonds to much higher risk higher reward international stocks. A good investment strategy will diversify the portfolio according to the specified needs. The most famous and successful investor of all time is Warren Buffett. In March 2013 Forbes magazine had Warren Buffett ranked as number 2 in their Forbes 400 list.<ref>

</ref> Buffett has advised in numerous articles and interviews that a good investment strategy is long term and choosing the right assets to invest in requires due diligence. Edward O. Thorp was a very successful hedge fund manager in the 1970s and 1980s that spoke of a similar approach.<ref>

</ref> Another thing they both have in common is a similar approach to managing investment money. No matter how successful the fundamental pick is, without a proper money management strategy, full potential of the asset can’t be reached. Both investors have been shown to use principles from the Kelly criterion for money management.<ref>

</ref> Numerous interactive calculators which use the kelly criterion can be found online.<ref>

</ref>

In contrast, dollar (or pound etc.) cost averaging and market timing are phrases often used in marketing of collective investments and can be said to be associated with speculation.

Investments are often made indirectly through intermediaries, such as pension funds, banks, brokers, and insurance companies. These institutions may pool money received from a large number of individuals into funds such as investment trusts, unit trusts, SICAVs etc. to make large scale investments. Each individual investor then has an indirect or direct claim on the assets purchased, subject to charges levied by the intermediary, which may be large and varied. It generally, does not include deposits with a bank or similar institution. Investment usually involves diversification of assets in order to avoid unnecessary and unproductive risk.

History

The Code of Hammurabi (around 1700 BC) provided a legal framework for investment, establishing a means for the pledge of collateral by codifying debtor and creditor rights in regard to pledged land. Punishments for breaking financial obligations were not as severe as those for crimes involving injury or death.

In the early 1900s purchasers of stocks, bonds, and other securities were described in media, academia, and commerce as speculators. By the 1950s, the term investment had come to denote the more conversative end of the securities spectrum, while speculation was applied by financial brokers and their advertising agencies to higher risk securities much in vogue at that time. Since the last half of the 20th century, the terms speculation and speculator have specifically referred to higher risk ventures.

Types of investment

Types of investments include:

See also

References

External links

See Also

versus:

References

References

External Links

Finance Business Economics


Investment has different meanings in finance and economics.

In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories.

In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.

In economics or macroeconomics

In economic theory or in macroeconomics, non-residential fixed investment is the amount purchased per unit time of goods which are not consumed but are to be used for future production (i.e. capital). Examples include railroad or factory construction. Investment in human capital includes costs of additional schooling or on-the-job training. Inventory investment is the accumulation of goods inventories; it can be positive or negative, and it can be intended or unintended. In measures of national income and output, “gross investment” ( represented by the variable <var style=“font-family: serif; font-size: 1.1em;”>I</var> ) is a component of gross domestic product (<var>GDP</var>), given in the formula <var>GDP</var> = <var>C</var> + <var style=“font-family: serif; font-size: 1.1em;”>I</var> + <var>G</var> + <var>NX</var>, where <var>C</var> is consumption, <var>G</var> is government spending, and <var>NX</var> is net exports, given by the difference between the exports and imports, <var>X</var> − <var>M</var>. Thus investment is everything that remains of total expenditure after consumption, government spending, and net exports are subtracted (i.e. <var>I</var> = <var>GDP</var> − <var style=“font-family: serif; font-size: 1.1em;”>C</var> − <var>G</var> − <var>NX</var>).

Non-residential fixed investment (such as new factories) and residential investment (new houses) combine with inventory investment to make up <var style=“font-family: serif; font-size: 1.1em;”>I</var>. “Net investment” deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.

Fixed investment, as expenditure over a period of time (e.g., “per year”), is not capital but rather leads to changes in the amount of capital. The time dimension of investment makes it a flow. By contrast, capital is a stock— that is, accumulated net investment to a point in time (such as December 31).

Investment is often modeled as a function of income and interest rates, given by the relation <var style=“font-family: serif; font-size: 1.1em;”>I</var> = <var>f</var>(<var>Y</var>, <var>r</var>). An increase in income encourages higher investment, whereas a higher interest rate may discourage investment as it becomes more costly to borrow money. Even if a firm chooses to use its own funds in an investment, the interest rate represents an opportunity cost of investing those funds rather than lending out that amount of money for interest.<ref>

</ref>

In finance

In finance, investment is the purchase of an asset or item with the hope that it will generate income or appreciate in the future and be sold at the higher price.<ref>

</ref> It generally does not include deposits with a bank or similar institution. The term investment is usually used when referring to a long-term outlook. This is the opposite of trading or speculation, which are short-term practices involving a much higher degree of risk. Financial assets take many forms and can range from the ultra safe low return government bonds to much higher risk higher reward international stocks. A good investment strategy will diversify the portfolio according to the specified needs. The most famous and successful investor of all time is Warren Buffett. In March 2013 Forbes magazine had Warren Buffett ranked as number 2 in their Forbes 400 list.<ref>

</ref> Buffett has advised in numerous articles and interviews that a good investment strategy is long term and choosing the right assets to invest in requires due diligence. Edward O. Thorp was a very successful hedge fund manager in the 1970s and 1980s that spoke of a similar approach.<ref>

</ref> Another thing they both have in common is a similar approach to managing investment money. No matter how successful the fundamental pick is, without a proper money management strategy, full potential of the asset can’t be reached. Both investors have been shown to use principles from the Kelly criterion for money management.<ref>

</ref> Numerous interactive calculators which use the kelly criterion can be found online.<ref>

</ref>

In contrast, dollar (or pound etc.) cost averaging and market timing are phrases often used in marketing of collective investments and can be said to be associated with speculation.

Investments are often made indirectly through intermediaries, such as pension funds, banks, brokers, and insurance companies. These institutions may pool money received from a large number of individuals into funds such as investment trusts, unit trusts, SICAVs etc. to make large scale investments. Each individual investor then has an indirect or direct claim on the assets purchased, subject to charges levied by the intermediary, which may be large and varied. It generally, does not include deposits with a bank or similar institution. Investment usually involves diversification of assets in order to avoid unnecessary and unproductive risk.

History

The Code of Hammurabi (around 1700 BC) provided a legal framework for investment, establishing a means for the pledge of collateral by codifying debtor and creditor rights in regard to pledged land. Punishments for breaking financial obligations were not as severe as those for crimes involving injury or death.

In the early 1900s purchasers of stocks, bonds, and other securities were described in media, academia, and commerce as speculators. By the 1950s, the term investment had come to denote the more conversative end of the securities spectrum, while speculation was applied by financial brokers and their advertising agencies to higher risk securities much in vogue at that time. Since the last half of the 20th century, the terms speculation and speculator have specifically referred to higher risk ventures.

Types of investment

Types of investments include:

See also

References

External links

See Also

versus:

References

References

External Links

Finance Business Economics


Investment has different meanings in finance and economics.

In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories.

In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. It is indispensable for project investors to identify and manage the risks related to the investment.

In economics or macroeconomics

In economic theory or in macroeconomics, non-residential fixed investment is the amount purchased per unit time of goods which are not consumed but are to be used for future production (i.e. capital). Examples include railroad or factory construction. Investment in human capital includes costs of additional schooling or on-the-job training. Inventory investment is the accumulation of goods inventories; it can be positive or negative, and it can be intended or unintended. In measures of national income and output, “gross investment” ( represented by the variable <var style=“font-family: serif; font-size: 1.1em;”>I</var> ) is a component of gross domestic product (<var>GDP</var>), given in the formula <var>GDP</var> = <var>C</var> + <var style=“font-family: serif; font-size: 1.1em;”>I</var> + <var>G</var> + <var>NX</var>, where <var>C</var> is consumption, <var>G</var> is government spending, and <var>NX</var> is net exports, given by the difference between the exports and imports, <var>X</var> − <var>M</var>. Thus investment is everything that remains of total expenditure after consumption, government spending, and net exports are subtracted (i.e. <var>I</var> = <var>GDP</var> − <var style=“font-family: serif; font-size: 1.1em;”>C</var> − <var>G</var> − <var>NX</var>).

Non-residential fixed investment (such as new factories) and residential investment (new houses) combine with inventory investment to make up <var style=“font-family: serif; font-size: 1.1em;”>I</var>. “Net investment” deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.

Fixed investment, as expenditure over a period of time (e.g., “per year”), is not capital but rather leads to changes in the amount of capital. The time dimension of investment makes it a flow. By contrast, capital is a stock— that is, accumulated net investment to a point in time (such as December 31).

Investment is often modeled as a function of income and interest rates, given by the relation <var style=“font-family: serif; font-size: 1.1em;”>I</var> = <var>f</var>(<var>Y</var>, <var>r</var>). An increase in income encourages higher investment, whereas a higher interest rate may discourage investment as it becomes more costly to borrow money. Even if a firm chooses to use its own funds in an investment, the interest rate represents an opportunity cost of investing those funds rather than lending out that amount of money for interest.<ref>

</ref>

In finance

In finance, investment is the purchase of an asset or item with the hope that it will generate income or appreciate in the future and be sold at the higher price.<ref>

</ref> It generally does not include deposits with a bank or similar institution. The term investment is usually used when referring to a long-term outlook. This is the opposite of trading or speculation, which are short-term practices involving a much higher degree of risk. Financial assets take many forms and can range from the ultra safe low return government bonds to much higher risk higher reward international stocks. A good investment strategy will diversify the portfolio according to the specified needs. The most famous and successful investor of all time is Warren Buffett. In March 2013 Forbes magazine had Warren Buffett ranked as number 2 in their Forbes 400 list.<ref>

</ref> Buffett has advised in numerous articles and interviews that a good investment strategy is long term and choosing the right assets to invest in requires due diligence. Edward O. Thorp was a very successful hedge fund manager in the 1970s and 1980s that spoke of a similar approach.<ref>

</ref> Another thing they both have in common is a similar approach to managing investment money. No matter how successful the fundamental pick is, without a proper money management strategy, full potential of the asset can’t be reached. Both investors have been shown to use principles from the Kelly criterion for money management.<ref>

</ref> Numerous interactive calculators which use the kelly criterion can be found online.<ref>

</ref>

In contrast, dollar (or pound etc.) cost averaging and market timing are phrases often used in marketing of collective investments and can be said to be associated with speculation.

Investments are often made indirectly through intermediaries, such as pension funds, banks, brokers, and insurance companies. These institutions may pool money received from a large number of individuals into funds such as investment trusts, unit trusts, SICAVs etc. to make large scale investments. Each individual investor then has an indirect or direct claim on the assets purchased, subject to charges levied by the intermediary, which may be large and varied. It generally, does not include deposits with a bank or similar institution. Investment usually involves diversification of assets in order to avoid unnecessary and unproductive risk.

History

The Code of Hammurabi (around 1700 BC) provided a legal framework for investment, establishing a means for the pledge of collateral by codifying debtor and creditor rights in regard to pledged land. Punishments for breaking financial obligations were not as severe as those for crimes involving injury or death.

In the early 1900s purchasers of stocks, bonds, and other securities were described in media, academia, and commerce as speculators. By the 1950s, the term investment had come to denote the more conversative end of the securities spectrum, while speculation was applied by financial brokers and their advertising agencies to higher risk securities much in vogue at that time. Since the last half of the 20th century, the terms speculation and speculator have specifically referred to higher risk ventures.

Types of investment

Types of investments include:

See also

References

External links

investment.txt · Last modified: 2020/03/12 18:35 (external edit)