You can choose from four primary investment categories, or asset classes, each with its own set of characteristics, risks, and rewards:

  • cash.
  • Shares.
  • Property.
  • Fixed deposits.

Equities (stocks), fixed income (bonds), and cash equivalent or money market instruments have traditionally been the three basic asset groups. Real estate, commodities, futures, other financial derivatives, and even cryptocurrencies are now included in the asset class mix by most investing experts.

Portfolio. A list of the investments you've made. Risk. The degree of risk associated with an asset's return. The probability of a loss or a reduction in earnings in a business.

Having a well diversified portfolio is one of the golden laws of investing. To accomplish so, you'll need a variety of investments that will normally perform differently over time, allowing you to diversify your portfolio and lower overall risk.

Stocks, rental properties, real estate crowdfunding projects, and an online business are examples of good assets you might invest in to generate money. In addition to making money for you, these can rise in value over time.

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