Definition of investment

short-links - Tips: Definition of investment Investment is the capital used in the production or provision of services or goods and may be a fixed investment such as preferred stocks and bonds, or a variable investment such as property ownership. [1] Investment is defined as the assets that individuals and enterprises purchase in order to obtain Income at present or future. [2] Another definition of investment is the amount of money invested in something, especially in businesses that include buying new machinery and stocks Investment objectives The investment seeks to achieve a set of objectives, namely: [4] Protecting money from low purchasing power resulting from inflation. The objective of investment depends on capital gains and returns that maintain the purchasing power of invested money. To maintain the continued development of financial wealth, the aim of investment is to achieve acceptable financial returns, in conjunction with an increase in the value of capital. Access to the greatest value of current income is to focus investors on investments that generate the greatest returns without paying attention to any other considerations, such as the risk ratio.

Investment tools The investment is based on a set of instruments of its own and constitutes financial or real assets belonging to the ownership of investors. These instruments are investment instruments classified into two parts: [5] Material investment instruments, including the following: Economic projects: It is one of the most widespread types of financial investment instruments. It is diversified in its commercial, service, agricultural and industrial activities and seeks to produce services and commodities that constitute the needs of individuals. Real estate: investments are based on two methods: Direct investment: the investor is buying a real estate, such as land and buildings. Indirect investment: It is the investor's purchase of a real estate bond; through participation in an investment portfolio or real estate banks. Commodities: These products are characterized by investment characteristics, and have their own markets similar to the stock markets, examples of these commodities gold and coffee. Financial investment instruments, including the following: Equity: The financial documents that are given to individuals who own shares of the capital of a particular company. These shares are divided into two types:

The nominal value is the value of the share capital, the book value is the equity value of the share, not the preferred shares, but the profits and reserves. The market value is the price of the share sale In the capitalist market. Preferred shares are shares that confer on their owners their own rights, such as profit priority, and increase in the value of profit as a result of the liquidation of the company. These shares hold three values, such as ordinary shares: book, market and nominal values.

Bonds: They are documents proving that their owners have certain rights to own objects or use specific services. They are also debts of natural or legal persons. Bonds include the following types: Government bonds, known as government bonds, are long-term and medium-term debt instruments issued by governments for resources to help them cope with inflation or cover the economic deficit. Bonds issued by institutions: are contracts between enterprises (borrowers) and investors (lenders). In accordance with this agreement, the second party shall lend a financial amount to the first party that undertakes to repay it with the interest thereon at a specified date..

Another Information

Types of investment There is a set of types of investments that are classified according to several specific criteria. Here is information on the most important types: [5] According to its type Economic investment: is the production of services or goods for investment or consumption, such as agricultural and industrial projects. Social investment: is the pursuit of raising the welfare of social individuals, such as cultural and sports projects. Administrative investment: is the development of administrative places that are concerned with the preservation of society, such as military buildings and government. Human Resources Investment: It is the pursuit of human development that appears in the educational, training programs offered to individuals in the state. According to his instruments Include the following types: Real investment: Also known as business or enterprise investment, the investment is real when it provides investors with rights to acquire real assets, such as gold and real estate. Financial investment: is the purchase of a share in a capital or a loan that provides its owner with profits or benefits guaranteed by law. Moral investment: An investment based on access to knowledge or intellectual assets, such as the implementation of scientific research. According to the criterion of pluralism and lack thereof Multi-investment: Also known as portfolio investment; investing in more than one type of financial or physical investment instrument. Non-multi-investment: is to participate in a single investment, such as buying a financial asset or a single financial asset. According to the property standard That is to say, the investment belongs to individuals, groups or countries, and includes the following types: Private investment: An investment made by an individual or group of individuals legally within a private company. Public investment: An investment carried out by a state-owned enterprise or group of enterprises within a public company. Mixed investment: An investment carried out by a person or a group of persons, a facility or a group of private enterprises with a public enterprise or group of enterprises within any type of mixed enterprise that is shared between public and private parties.