Investing with little money seems like a daunting task. If you’re the only people who are thinking this.

Investment, Never forget the huge sums are starting to accumulate and become significant amount of investment has become been . You can increase the value of money in the future by investing less money.

 The question that arises is , which is the most appropriate way to invest with low initial capital?

Which method gives us the most profit? Do we need to take a risky or risky way to invest with little money?

We are here to show you the right way by introducing investment ways.

Low money investment:

Maybe you happened to be when it comes to investing the little money you , people around you say, buy dollars! Now the coin market is hot , why not enter the stock market? Or they may disappoint you and say in response to your question: This amount of money is not worth the investment!

The important thing here is to know , actually between being; That is, do not look for a miraculous and dreamy way . It has long been said: “Without suffering, treasure is not possible.” To start investing , it does not matter how much money you have, it matters how you invest and where or in which market you invest your money.

If you live in an inflationary society , the best way to prevent money from devaluing is to invest; Because the conditions created can be used to witness the growth of capital. Whenever you have to invest a little money to , golden opportunities are opening up before you, which multiply the money you have in the years ahead.

What is an investment?

Investing means allocating money in exchange for future profits or benefits. In economics , investing means committing money to a commodity that will be profitable for the individual in the future.

In finance , investing means buying a commodity like a stock that is expected to make a good profit in the future and make a profit by selling it at a higher price.

“Investing is a money-making planning process to make more money in the future,” says Warren Buffett. Never rely on one source of income; Invest in another resource. ”

Before investing with low money, due to the lack of initial capital, it is necessary to know and gain knowledge about investment methods. It is essential to get enough information about the risks in the market; Because in case of making a mistake, there is a possibility of loss of capital or irreparable losses.

Large investors often have a long-term vision and enjoy a positive return on investment for years.

Investors can be divided into three categories based on risk. First , they are risky. These people engage in various types of transactions or investments by accepting risk. In fact, risk is a good commodity for them. The next category , people who are in the risk-neutral. These people neither accept the risk nor run away from it. The third category is risk-averse people , who are very risky transactions and investments with runaway risk. Risk-takers are more likely to seek ways to invest safely.

 

Types of investments:

In general, investment can be divided into the following three categories:

1. Ownership
2. Accreditation
3. Cash transactions

Property investment:

Property investment is profitable as well as risky. This type of investment , itself divided into the following categories.

Investing with low money in stocks:

You buy a stake in a company or factory by buying it. Entering the stock market does not require much initial capital. You can become a stock owner with at least 500,000 Tomans. So investing in a stock market is a low money investment .

During the time you own the shares , if the company or factory is profitable , you will also share in that profit. Profit from the sale of products or services is distributed among all shareholders. Also, your profit on the stock market value of assets that is , attained.

Investing with low money in business:

Investing in a business is a difficult way to make a profitable investment . To start , you need to have entrepreneurship to produce a product or provide a service to people who need them , who will benefit. Despite all the difficulties , this investment can bring good returns and profits.

Invest with little money by buying expensive goods:

If you are investing with little money long-term , buy expensive goods can be a good way to invest. The main purpose of this investment is to make a profit in the future by selling goods that are worth buying and reselling; Such as: antiques, gold, jewelry and…

The price of these goods has increased over the years.

These types of investments are very risky and may not be the right way for many people; Because they need a lot of care. Also, these goods are exposed to physical damage due to various causes.

Investing by buying a property:

You rent or sell the property after the repair , an investment’ve done. It should be noted , however , that the home in which you live does not include this type of investment; Because the property was purchased to meet basic needs.

It takes a lot of capital and money to invest in real estate. So it is not possible to enter this market to invest with little money .

Credit Investment:

This investment has less risk than previous investments. Low-yield lending gives the investor less profit. In this type of investment you have a role like a bank. You buy company bonds and you will receive a certain amount of money after a certain period of time. In this investment, the amount of money you receive is fixed, even if the company goes bankrupt or has a high profitability during that period. Types of lending investments are listed below:

1) Invest with low money through savings:

Most people think of banks when they hear the word investment. Investing in a bank is a safe and risk-free way. The low risk of this market has provided the ground for risk-averse people. Have you ever thought about how banks work?

Too often, the 20 and 22 percent interest rates on some deposits are tempting for many people. Books by opening of the deposit , the money you borrow. A portion of the profits from the money will be credited to your account on a monthly basis. When you open a savings account in a bank and this account becomes your only way to earn money , then you are actually an investor who has lent money to the bank.

Open a savings account , for risk-averse individuals who want to invest the little money they have , opportunity and risk is considered low.

Investing with low money through securities:

Securities , a widespread class of investment; Such as: Treasury bonds of international loans and bonds of small enterprises and… profit and loss in this type of investment is different. Securities provide another opportunity for risk-averse investors to invest. This type of investment has less profit than property investment.

Cash equivalent investment:

This investment in services or goods bought by you , in fact, is the same as cash. Money market investment funds are cash equivalents.

These funds , risk is limited. Whenever you want , you can convert it to cash. These funds act as a financial intermediary. Investors’ surplus funds are accumulated in these funds and they invest in securities.

After getting acquainted with investment and the market , it is time to discuss the main factors in investing. It does not matter if your goal is to invest low or high , in any case, these factors are essential for a profitable investment.

Principles of investing with little money:

Before investing, you need to make sure you have the cash you need for the next 3 months. It is better to use surplus and stagnant money for investment. Here are some investment principles:

1) Determining the purpose of investment:

Not everyone has the same goal of investing. First , set your goal; For example, this investment is for retirement or to meet basic needs. Goal setting helps you calculate how long you have been holding the capital.

It should be noted , long-term investing provides more profits for you. If the goal is to invest with little short-term money , then low-risk opportunities are better for you.

When investing , determine whether your goal is to grow capital quickly or to be risk-averse. When setting a goal , do not forget to preserve the principle of capital.

2) Maximum use of investment with low money :

You’re investing your money in any market , is very important. Some people make the mistake of choosing a market for their investment. Consider someone who borrows from a bank; For this loan, the bank must pay annual installments with 18% interest. The same person puts the loan money into the capital market , earning 15% interest annually. Do you think this person has chosen the right market to invest in?

In addition to the right place to invest, choosing the right time to invest is also important; For example, if a person decides to invest with little money , he puts his money into the stock market. If it enters the market at the time of reform, it may lose all its capital. Price charts are not always the same ; That is, not every price rises or falls. After examining the right time , prevented from entering the market is at a tipping point.

3) Quick liquidation:

If you are planning to invest with little money in the short term , consider liquidity capital. Liquidity means that if you decide to liquidate your property or capital , you can cash it in at the right price in the shortest time.

Liquidity in the Iranian market can be categorized as follows:

1. Bank deposit
2. Currency, gold and coins
3. Stocks and securities
4. Business assets
5. Real estates

Knowing these combinations will help you in investing with little money .

6) Measuring the level of investor risk tolerance:

Risk tolerance when investing with little money is an important and fundamental principle. It is clear that investing in high returns is more risky. None of the markets are calm and volatile. But the skilled investor knows how to cover his losses with a profit.

If you do not have the risk , then do not enter every market to invest with little money . If you are in the category of people who have the ability to bear temporary losses for higher returns in the future, then go for risky investing.

Finally, to complete the discussion, the investment can be divided into the following categories based on the amount of risk:

• Risk Investing: If you need your money shortly after investing, you probably do not want your money to be deducted during this time; Because you have opened an account on that money. That’s why investing in low risk would be a wiser choice.

• Medium Risk Investing: If you do not need your money for the near future, medium risk investing can pay off. Investing with low money and moderate risk will give you a good cash return in the medium term.
• High-risk investment: If you have a high degree of risk tolerance, you can choose the investment that has a higher risk and higher returns. This investment can give you a good profit in a short time.

And finally, our advice is that, for a profitable investment, it is better to divide the money into two parts; Part of it should be invested in a market with high risk and long-term goal and the other part should be invested in a low risk and short-term market. Dividing capital into investing with little money seems a bit difficult, but for large investments it is better to use diverse markets.