It is unlikely that you’ll get a low-risk investment with high returns. The risk is always inversely proportional to the return. What this means is that for you to get a higher return on your investment, you must be prepared to take a higher risk.
Therefore, how to make money online through investment is to ensure that your risk profile matches the risks of the product you want to invest in. You may want to go for investment products that come with higher risk but which can potentially produce high inflation-adjusted returns compared to other investment products in the long term. Alternatively, you can invest in assets with low risk and low return.
Also, you can choose to invest in a financial asset or a non-financial asset. These two are known as investment buckets. Assets classified under financial buckets include forex trading, stocks, mutual funds, bank fixed deposits and more. Assets classified under non-financial buckets include investment in gold and real estate.
Some of the top investment assets you can choose include the following:
- Direct equity
Stocks are volatile asset to invest in. While it is a worthwhile asset, it may not be suitable for every investor. You need to time your entry and equally choose the right stock to get a return on your investment.
- Equity mutual funds
Equity mutual funds mostly involve equity stocks which are either managed actively or passively. In an actively traded fund, the returns are largely dependent on a fund manager’s ability to generate returns. The index funds and exchange-traded fund (ETFs), for instance, are examples of passively managed equity stocks you can invest in.
- Real Estate
Besides, stocks and forex which are financial bucket investment, a good non-financial investment asset is real estate. This excludes the house you live in but include any additional property you purchase but which you don’t intend to live in. The value of the property and the return you will get on a real estate investment mostly depends on the location. While a real estate return can come from capital appreciation and rent, real estate asset is an illiquid asset.
Investing in gold is another way you can make money trading online. You can invest in gold coins or gold ETFs.
- Cryptocurrency and mostly Bitcoin USD is another viable but very volatile investment option. You can trade bitcoin cash through bitcoin mining. You can either trade bitcoin through bitcoin reddit or bitcoin app when you are on the go.