Business Learning Centre

Imagine that we are afraid of investing in the stock market because the market is complicated, do not understand it or simply looking for an investment with zero risk. Clearly there are alternatives, which have no risk or the risk is controlled and / or insured.

To give some examples, we have two that are safe investments such as fixed-term deposits and treasury bills. It is clear that if the state went bankrupt last thing you should worry about is your investment in the arts, as talk of a country’s financial apocalypses and all will suffer. With regard to bank deposits, these are backed up to 100,000 Euros for the deposit guarantee fund, so both are safe choices. The question is: I can lose money even with returns from these investments? The answer today is yes, and explained why.

Very few people are those who have to spend time with two terms, with which should be familiar. These terms and CPI inflation.

To cut a very technical article, we will explain in a simple manner. $ 100 did not have the same value for 12 years now, and the pace we go, 100 Euros will have much less value in a year.

This simple fact is unknown to many individuals, which would explain why they have invested in treasury bills with a yield of 2.77% while the CPI is located at 3.80%. These individuals or small investors seeking a safe investment, have found in the treasury bills, but do not know yet still safe, have lost purchasing power within 12 months.

So it is with those who have contracted bank deposits to 3.50% APR for 12 months. Let’s say that both investments are as if they had kept their money in a safe. Practically, the money is pooled.

Others seek investment and easily studied by other persons or bodies, so they decide to invest in guaranteed funds, or simply structured, investment funds, which like most of you know, in negocios1000 are not very supportive of this type of product. Beware of investment funds.

These data confirm an old saying in the economy and that is the only way to find your money is profit taking risks.