Whoever makes an investment to protect their assets, seeks that it is safe and brings financial return. However, to be successful it is necessary to pay attention to all the factors involved in each form of application.
In this way it is possible to determine which type of investment best fits the budget and personal goals.
Among the factors that involve the return on an investment, its duration is one of the most important.
Thus, before investing it is necessary to determine whether the investment will be short, medium or long term. We will understand here the basic differences between each of these types of applications.
When it comes to investment, you immediately think of large amounts of money. Likewise, big goals are thought of. However, it is also possible to apply small amounts of money if your goal is simpler.
In the application world, when talking about the short term, it refers to a period of up to two years. However, it is possible to invest up to 30 days. For this you can hire a bank or broker.
In addition, there are CDBs and government bonds where you can redeem your investment at any time. In this case, the security’s liquidity is daily.
However, even if your goal is short-term, it is worth making an investment. But remember that the shorter the term, the greater the risk of losing money. So, if you opt for an investment of this type, the ideal is that you choose a conservative application.
Often choosing those that have daily liquidity can be a great idea. For short-term investments, there are a few options that you can and should consider:
SELIC Treasury : this Treasury Direct title is guaranteed by the government. Therefore, it is considered the safest investment in the country. In addition, you can redeem your money even before the deadline without deducting any amount for it.
CDB: this investment is guaranteed by the Credit Guarantee Fund. Therefore, they are very safe, as well as profitable. In addition, there are options with very short terms and daily liquidity.
LCI and LCA: as they are not subject to income tax, these investments have a good return. Although they do not have daily liquidity, there are options with terms of up to 2 years.
A medium-term investment has a term of between 2 to 5 years. This type is an intermediary between short and long term investments.
However, many investors ignore this category. However, it is very important as well. But as with other types of investment, in the medium term it is also necessary to define the objectives very well.
Medium-term goals are usually big. Therefore, they must have good planning so that they can be achieved in later years. So, if you are planning a trip, wedding, exchange or even buying a car, you can benefit from this type of investment.
When making an investment, the ultimate goal is to achieve a certain level of security. And medium-term investments have a certain level of reliability. Despite this, it is always necessary to study the market very well and evaluate all risk factors of the operation.
However, it is necessary to take risks as well. And it can be said that they are worth taking on in exchange for greater profitability.
There are many options for making medium-term investments. Some of them are:
LCI and LCA: as already mentioned, this type of investment is not taxed by income tax. Therefore, they have good profitability. In addition, there are several options for LCIs and LCAs with terms ranging from 2 to 5 years.
RDB and LC : these investments are financial. Despite being less recognized, they are highly profitable. In addition, they are guaranteed by the FGC, which makes them even more advantageous. The term of this type of investment usually varies between 3 and 5 years.
Treasury Direct : This type of investment can prove to be very good in periods of higher inflation. This is because they guarantee the real return on investments in the period. Even in this case, the advance sale of the security can be harmful because it presents a risk. In addition, they provide the possibility of high profitability in investments of up to 5 years.
Investment funds: for people who are willing to take more risks, this investment may be appropriate. In addition, there are several fund options, with different maturities.
Thus, it is possible to select the most suitable investment for your profile. There are even options with daily liquidity that provide excellent yield. However, it is necessary to be very careful not to pay high fees, reducing profitability.
Long Term Investments
Long-term investments are the most relevant type for a person’s financial life. In this case, the objectives are set for periods greater than 5 years. Therefore, this type of investment can be very useful, for example, to buy a house, pay for the children’s college and even retire after many years.
Although it seems difficult to plan a long-term investment, but this is essential to increase the chances of success.
In addition, this type of investment is what brings the highest profitability. Therefore, it is the most suitable type for those who aim to earn large amounts of money. This is because short- and medium-term investments will never provide the profitability that long-term investment can provide.
If well-planned long-term investments are made, it is even possible to stop working, living only on income. And let’s face it, this is a dream for many people.
As the investment term is very long, it is very difficult to predict whether it will be successful. Despite this, the chances of reversing any eventual losses are very high.
This means that the chances of having a loss at the end of the period are small. Therefore, although there is a high risk of loss, the chances of making a profit are greater in relation to shorter-term investments.
Therefore, there are some options for making this type of investment.
To invest in stocks you need to know the market trends well. In addition, you must select the company you are going to invest in very well. Ideally, it should be a well-established company, with a good management team and a favorable profitability record. However, you should not despair about the oscillations, as they can occur. What matters is always to recover the losses. And in long-term investments it is easier to achieve this.
Financial institutions have several investment funds. Then, you will have many options at your disposal. The ideal is to know each one well and select the fund in which you will apply. And you still need to know the information about it very well, including comparisons of rates and profitability.
Finally, keep in mind that often the best funds may not belong to traditional banks. So, be open to new brokers and even independent managers.
- Real Estate Investment Funds (FII):
From the FII you can invest in several properties at the same time. In this way it is possible to reduce the investment risk. In addition, there is no disadvantage of paying income tax on the rent received. So, this type of investment can prove to be advantageous and even quite profitable.
- Direct Treasury:
The Selic Treasury is directly related to the IPCA, that is, inflation. This provides real gains. In addition, there are several term options, even over 20 years. Therefore, this type of investment can be well suited for those who think of retiring in this way.
We can conclude that there are investments that fit several objectives. So, it is possible to invest almost any amount of money, for different periods of time.
So, investing can be great for your financial health. But it is very important to obtain the maximum knowledge on the subject before making an investment. That way you reduce risk and increase your profitability.