12 Types of Investments You Have To Know About + Consider - In The Game Investing (2024)

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The world of investing is huge, and knowing where to start isn’t always easy. Often, the advice we get is to start with low-return yet safe ETFs and bonds, but is that always the best option?

It’s always recommended to diversify your portfolio – meaning you spread your money across a range of different income-generating assets that offer the right amount of risk and management for your goals and preferences. This will help you avoid disaster if one of your investments doesn’t work out.

So, to ensure you know all of the best options available to you, we’ve rounded up 11 of the best types of investments you should know about and consider when investing.

Table of Contents

Types of Investments

We’ll start this list with the most well-known types of investments and move into alternative types of investing later in the list to give you the widest overview of what is available to you.


Stocks (also known as equities) are the most well-known form of investing. When you buy a stock, you’re essentially buying a share (which is why this type of investment is referred to as stocks and shares) of ownership in a company. The more stock you own, the bigger the percentage of that company you own.

With this type of investment, you’ll usually receive dividends when the company reports a profit. You can also make money with your stock by selling it at a later date when the price of the stock has increased.

You can hold onto a stock for as long as you please, and will only lose money if the company gets into difficulty and the stock price drops and you decide to sell, if the stock price never recovers, or if the company goes bust.

Stocks can play an important role in your investment portfolio, but they are higher risk than some of the other options we’ll cover next. For that reason, they should generally be the second or third asset you consider investing in unless you’re particularly passionate about a company and want to support its growth.


A bond is where you essentially loan an entity money in exchange for the interest they pay on the money they borrowed. There are a wide variety of bonds, but the most popular type of bonds are generally government and federal agency bonds because they are a relatively assured investment – much more like a savings account than some of the more high-risk options on this list.

That said, they’re not always risk-free – if you buy an individual bond and sell it before it “matures” (the date on which the entity you loaned the money to must pay you back), you may lose money. If you want to buy a risk-free bond, look at treasury bonds.

You can buy bonds through Treasury Direct for the U.S. Treasury, through your brokerage, or as part of a mutual fund or ETF, which we’ll discuss below.

Mutual Funds & ETFs

Mutual funds and ETFs are some of the most common forms of investing and are available to people of all levels.

Mutual funds and ETFs (Exchange-Traded Funds) are investment vehicles you can put your money into to benefit from a specific investment strategy. Publicly-offered funds are registered with the SEC (Securities and Exchange Commission), while private funds (usually called hedge funds) are free to act as they please.

These funds are managed by private companies. Publicly-offered funds are generally lower risk than hedge funds, though hedge funds are much more likely to offer big returns. Funds (public or private) usually have a minimum investment amount, and may also have a minimum monthly contribution.

Stock Options & FOREX

Options trading is one of the riskier ways to invest because it relies on your ability to foresee how the market will change, depending on psychological factors that affect how people buy and sell. This may be world news, a press conference, rumors, and other circ*mstances. You’ll also need to learn how to do technical analysis of graphs so you know what you’re looking at.

FOREX (trading currencies) works similarly but is all centered around how global currencies perform in relation to one another.

With both stock options and FOREX trading, you have the potential to make a lot of money when you know what you’re doing, but note that only around 1% of all people who try trading will make a profit in the long run. This can be a good way to diversify your portfolio once you’re established and want to try day trading, but it’s best not to start seriously investing until you have $25,000 to play with.

Real Estate

Real estate is a popular choice of investment for obvious reasons – you secure your money in something you can see, improve, and make a monthly income from if you rent it out. Real estate doesn’t often lose value, so putting your money into a property should mean you can get it back when you sell it.

That said, if you are unable to rent out a property, it may become more of a liability than an asset, at least on a month-to-month basis, and you may need or want to use a property manager to manage your tenants for you.

The good news is you don’t need to wait until you’ve saved enough for a deposit to start diversifying your portfolio in real estate. You can try investing in crowdfunded real estate with as little as just a few hundred dollars through sites like Fundraise and RealtyMogul.


Commodities are things like oil, grain, and metals. You can trade commodity futures, where you agree to buy or sell a quantity of a commodity when it reaches a certain price on a specific day, but this must be done on the floor of a commodity exchange. Most people trade commodities in the same way they do currencies – by buying or selling contracts in these commodities, but you can also buy and hold.

If you’ve spent any time in the investing sphere, you’ll know that the price of gold is generally good, but it always spikes when there’s global drama. Why? Because people see gold as a sure thing – gold has always been valuable and likely always will be. That said, gold (whether bought through an ETF with your online brokerage or owned physically) doesn’t increase in value very quickly. It’s increased around 335% over the past 30 years, while the Dow Jones industrial average has increased by 1255%.

Gold is a good place to put your money if you want an alternative to a high-yield savings account.


In recent years, cryptocurrencies have evolved from a novelty to a very real asset, though it does depend on the cryptocurrency you choose to invest in. Today, many large investing platforms allow you to buy cryptocurrencies. There is much debate about whether an explosion in the value of a cryptocurrency can or will happen again in the future, as happened with Bitcoin, but while there may not be another “gold rush”, they’re certainly not going anywhere any time soon.

Whether investing in cryptocurrency is right for you depends on your appetite for risk – try to gain an understanding of how the blockchain and cryptocurrencies work before you invest.


NFTs, non-fungible tokens, are the latest digital asset to hit the market. Although the concept isn’t new, its popularity is growing. Digital artwork is being sold for its unique properties to the highest builder.

The NFT market generated more than $25 billion worth of trading in 2021. Several Bored Ape yacht Club NFTs have sold for more than $1 million USD with a record of $3,408,000. And the most expensive NFT sold for $69.3 million. The digital artwork represents a collage of 5,000 pieces of Mike “Beeple” Winkelmann’s earlier artworks.

Although risky, NFTs still represent a lucrative investment option for some.


Investing in a business, either as an owner, angel investor, or a silent partner can be a lucrative choice, provided you choose the right people to partner with. If you’re considering investing in someone else’s business idea, make sure you trust them not just as a person but also as a business person. There are plenty of business partnerships that have worked out well when one person has put up the capital and the other person has put in the sweat equity, but it’s a risk.

Remember that it may take you a few years before you start seeing any of that money come back to you. That said, if the business becomes profitable, you’ll see returns through dividends and a big payout if you decide to sell your share or if you and your business partners decide to sell to another company. Plenty of fortunes have been made this way, but make sure you have a contract in place with the expectations of each person laid out in black and white.

Of course, you could also found your own businesses. Serial entrepreneurs often create a business, work in the business to make it profitable, hire people to run it, and then repeat the process, reaping the benefits of many profitable businesses. This type of investing certainly isn’t for the faint of heart but can be incredibly rewarding, monetarily and emotionally.


Collectibles can be one of the most fun ways to invest your money, provided you’re passionate about what you’re investing in so you’ll not only buy collectibles that are likely to increase in value but also enjoy what you own while you own it. Some of the most common collectibles are vehicles and art, but other collectibles are:

  • Movie props and scripts
  • Whiskey and wine
  • Antiques, including the personal effects of famous people
  • First editions of books and rare editions of magazines and comics
  • Coins
  • Toys
  • Stamps

Essentially, if it’s something other people want, is rare, and cannot be easily bought at retail, it’s a collectible. Most valuable collectibles are sold through private sales or auctions, but you can definitely get a start on sites like eBay and secondhand sites if you know what you’re looking for. For high-end items, some of the most famous auction houses are Christies, Sothebys, and Bonhams.

Digital Real Estate

Digital real estate doesn’t have anything to do with buildings, but it has everything to do with ownership of properties – virtual that is. Every domain name and website out there is a digital asset of varying value. While one domain may only be worth $10, another can be worth thousands – like collectibles, it’s all about supply and demand.

Websites are even more valuable because they are an opportunity to make money. Take a look at a site like Flippa.com where you can buy and sell online businesses. The price of buying a website that’s up and running depends on how easily the business can be transferred to someone else, how much money it’s making, and how much work is involved with maintaining it.

For example, at the time of writing, there’s an ecommerce website with a net monthly profit of $22,200 for sale for $940,000, a blog with a monthly profit of $18,000 for sale for $890,000, and an iOS app business making $129,000 per month profit for sale for $4.5 million. These examples require more of an investment upfront (and more knowledge of running online businesses to keep them offering good returns), but there are opportunities available at much lower entry points.

Peer-to-Peer Lending

A great alternative way to diversify your portfolio is with peer-to-peer lending. Peer-to-peer lending is what it sounds like – you lend someone money and make money on the interest you charge until the loan is paid back.

In most cases, you’ll be funding a small business loan along with several other investors. Business loans are difficult or even impossible to get if a business is less than 2 years old, so business owners look for alternative options to get the funding they need to smooth cash flow or raise capital to purchase new stock.

Lending to businesses can be preferable for you, too, since you’ll usually get an inside look at how they plan to use the money and they often repay within a short time frame.

Regardless of whether you choose to fund business loans or personal loans, make sure the platform you work with is reputable and offers you some level of security. Some of the most popular platforms are Upstart, Prosper, and Kiva.

Are there any types of investments that should be avoided?

Almost all types of investments offer some element of risk, though some will offer a more assured return than others. Generally, the riskier the investment, the bigger the possible return (but also the more likely you are to lose money).

Before investing any money, consider your risk appetite. Are you prepared to lose money, or would you prefer smaller returns but feel safe in the knowledge the value of your assets is almost the same from one month to the next?

One type of “investment” to be wary of is binary options. Binary options trading is where you essentially bet on a result over a very short time frame – typically hours or minutes. Binary options are seen by most as a form of gambling, and they have the added complication that many of the platforms offering binary options are fraudulent.

Because of this, they’re not advised and are now illegal in many countries across the world. If you decide to trade these options, make sure you understand what you’re getting into and make sure the exchange you’re using is regulated.

Final Thoughts

The most important takeaway is to start – standing on the sidelines means you miss out on possible returns over the long term. Learn how the stock market works and identify the investing strategies that work for you. You’d be surprised what you can teach yourself through books on investing or an investing course.

If you’re still a little lost, consider talking to an investment advisor or financial planner if you have questions. You want to create a diversified portfolio across asset classes with long-term investments.

The best investment is the one that you believe in. Your key to success is building a portfolio of investments that make you feel excited about your future and offer just the right amount of risk and involvement for you.

Theresa Bedford

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Theresa is a personal finance blogger. She writes content for busy professional women to take control of their money and investments. She enjoys reading, traveling, cooking, and writing. Her work has been featured on GoBanking Rates, Your Money Geek, Savoteur, the Corporate Quitter, Thirty Eight Investing, and more.

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Greetings, fellow investors and enthusiasts! I'm Theresa Bedford, a passionate advocate for personal finance and investments. My extensive experience and knowledge in the field have been honed through years of research, practical application, and a commitment to staying ahead in the ever-evolving world of finance.

Now, let's delve into the concepts covered in the article, "The 11 Best Types of Investments You Should Know About":

  1. Stocks (Equities): Stocks represent ownership in a company. They offer the potential for dividends and capital gains. However, they are considered higher risk and should be part of a diversified portfolio.

  2. Bonds: Bonds involve lending money to an entity in exchange for interest payments. Government and federal agency bonds are often seen as lower-risk options, akin to a savings account.

  3. Mutual Funds & ETFs: These are investment vehicles allowing individuals to invest in a diversified portfolio managed by professionals. Mutual funds are managed by private companies, while ETFs are exchange-traded funds that can be bought and sold on stock exchanges.

  4. Options Trading & FOREX: Options trading involves predicting market changes based on various factors. FOREX, or foreign exchange trading, focuses on currency performance. Both carry higher risks and require a good understanding of market dynamics.

  5. Real Estate: Real estate is a tangible investment, offering the potential for rental income and property appreciation. Crowdfunding platforms provide opportunities to invest with lower entry points.

  6. Commodities: Commodities include items like oil, grain, and metals. Trading can be done through commodity futures or by buying and holding. Gold, in particular, is considered a stable investment.

  7. Cryptocurrency: Cryptocurrencies have evolved into a significant asset class. While the market can be volatile, cryptocurrencies like Bitcoin have gained legitimacy. Understanding blockchain technology is crucial for potential investors.

  8. NFTs (Non-Fungible Tokens): NFTs represent unique digital assets, often tied to digital art. The NFT market has experienced substantial growth, though it involves risk and speculation.

  9. Business Investments: Investing in businesses, either as an owner or silent partner, can be lucrative. However, it requires careful evaluation of the business and a long-term perspective.

  10. Collectibles: Collectibles, such as art, vehicles, and rare items, can be both enjoyable and profitable investments. The value often depends on rarity and demand.

  11. Digital Real Estate: Digital real estate involves owning virtual properties, such as domain names and websites. Websites with established revenue streams can be bought and sold as online businesses.

  12. Peer-to-Peer Lending: Peer-to-peer lending allows individuals to lend money to others and earn interest. It's an alternative way to diversify a portfolio, especially in business loans.

As for investments to avoid, binary options are highlighted as risky and often seen as a form of gambling. They are illegal in many countries, and caution is advised due to potential fraud.

In conclusion, the key takeaway is to start investing and build a diversified portfolio aligned with your risk tolerance and financial goals. Continuous learning, whether through books, courses, or consultations with financial advisors, is essential for success in the dynamic world of investments. Remember, the best investment is the one that aligns with your beliefs and provides the right balance of risk and excitement for your financial future. Happy investing!

12 Types of Investments You Have To Know About + Consider - In The Game Investing (2024)
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