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Life as a whole is all about giving and taking. And nothing proves this more than investing. There are many different ways you can invest, so you’ll need to choose the one you feel comfortable with. In addition, every investment method is different from each other, which means you’ll need to know the ins and outs before you make a final decision. Here are three types of investment to consider.

Investing in Stocks

Stocks are the poster boy for investments. They’re easy to learn, you don’t need a large sum of money to get started, and you can achieve a large payout over time. And if you get started at a young age, the payouts and knowledge gained can be significant. However, despite their simplicity, you need to know what you’re doing with stocks. Investing without learning about the process isn’t a good idea, especially if you’re new.

There are two main types of stocks: common and preferred. These stocks are divided into various sub-categories. For example, preferred stocks are separated into callable, participatory, cumulative, and convertible shares. An example of common stock would own a small portion of a company, which is the most common form.

Day Trading

Day trading isn’t exactly a new type of investing, but it’s one of the most underrated and uncommon. Day trading is when you buy and resell stocks within a short time. Learning this, you might be thinking this is relatively inefficient because of how expensive stocks can be. Although this is partially true, stocks come in many different forms.

The reason why day trading is even doable is because of penny stocks. Penny stocks aren’t what you think as they don’t cost a penny. If they did, everyone would be buying them. Penny stock is just the term to identify stocks that cost $5 or less. However, penny stocks are somewhat risky than your usual investment for several reasons.

For instance, penny stocks have low liquidity, which means they’re most likely not able to pay off debt. In simpler terms, low liquidity is a huge credit risk. Penny stocks also tend to have little to no history, making them untrustworthy. Day trading has seen plenty of success from constantly trading penny stocks, but compared to traditional stocks, you need to have a broad understanding. Reading an in-depth guide on day trading gives you all the information you need to trade safely. It also offers insight on the best penny stocks to buy and sell, so you can avoid being scammed.

A High-Yield Savings Account

Putting money into a savings account isn’t exactly an official form of investment as there’s no risk involved. The only risk you need to worry about is inflation, which can make it a bit more difficult for you to purchase. Aside from that, there’s no limit to how much money you can put into this account. It’s also government-insured, which gives you an extra layer of protection. So even if the company your account is a part of goes bankrupt, you’re still entitled to a payout.