Learn about the safest types of investment and get started now!
You've asked yourself how to make your money go further at least once in your life, haven't you? Everyone goes through this when they think about it, so we're going to show you the safest types of investments so that your financial life can change for the better.
In this sense, starting to invest money is an excellent strategy for those who want to ensure greater security for their personal finances. However, before investing any money, we should consider a number of factors to guide our choices more clearly.
So, in this article we'll talk about the safest types of investment and give you some basic guidelines so that you can start investing. Let's go?
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Savings: is it still worth it?
When we talk about saving money, the first thing that comes to mind is the savings account. It's no wonder that this type of investment has become the darling of Brazilians. Over the years, families have passed down from father to son the idea that savings were one of the safest, most reliable and, above all, profitable investments.
But do you know how it works?
Savings have two income rules. These are
- 0.5% per month (6.17% p.a.), plus the TR variation (reference rate);
- When the basic interest rate (Selic) is equal to or less than 8.5% per year, savings will yield the equivalent of 70% of the Selic rate target per year, monthlyized, plus the TR.
However, the Selic rate currently stands at 3.5% per year and the savings rate has an annual return of 2.45% (around 0.20% per month). In this context, these rates serve to measure, alongside inflation, whether people's purchasing power has increased, decreased or remained the same.
In 2020, for example, inflation ended the year at 4.52% and the passbook at 1.99%. In other words, the money saved lost its purchasing power. So, in this case, it's not recommended to invest in savings if you want to make more profits.
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First step: understand basic concepts
In order for you to understand more about investments, there are three basic factors in the financial market that should be analyzed before any investment is made. Check them out:
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Profitability:
are the gains from leaving your money invested. In other words, the return on the initial investment;
Liquidity:
is how quickly you can redeem the money you have invested without making a loss;
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Risk:
are the chances of the return being lower than expected or, in other cases, even negative.
According to these criteria, the greater the promise of profitability, the higher the risk of an investment and the lower the liquidity. And if liquidity is lower, the risk increases considerably. You can then choose the safest and most profitable investments.
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Suitability: how to define your investor profile
After understanding the basic tripod of financial market rules, the next step is to analyze and identify your investor profile. This process, called Suitability, directs the most suitable investments to the needs and desires of each client. It's quite simple to find out which category you fit into.
Having a Suitability tool or he investor profile assessment (API) is a reality for most banks and allows them to sell customized assets according to the results of the form.
In this sense, there are 3 main investor profiles with a series of unique characteristics and types of investments more in line with the personality of those who answered the form. The categories are:
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Conservative:
are more fearful and cautious people who don't want to take too many risks. They accept lower profits as long as the security of the financial investments is maintained. Fixed income products such as Treasury Direct and CDB are the most recommended for those who fit this profile.
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Moderate:
have a little more tolerance for risk and expect to make above-average profits. Therefore, your investment portfolio can mix fixed income products (Treasury Direct and CDB) and variable income (shares and real estate funds).
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Aggressive:
are inclined towards riskier investments and, consequently, higher profits. These are people who already have knowledge and experience of investments. For this type of profile, the range of options is much wider.
Now that you understand basic concepts and how to map investor profiles, let's talk about the 5 main types of investments.
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5 main types of investment
Direct Treasury
Tesouro Direto (Treasury Direct) is an application linked to the Brazilian government's National Treasury that allows you to buy Treasury bonds. Federal Public Debt. With this, you lend money to the government to invest in health, education and other sectors for generate more social welfare and receive interest for it. Some of the title options are:
- Fixed-rate bonds: because they have pre-established rates, you can see how much you will earn when you make the investment.
- Post-fixed: depends on indicators such as the Selic rate. Therefore, final yields can fluctuate.
- Hybrids: their returns are made up of the variation in inflation with a predefined interest rate (e.g. IPCA +2%)
For those who have little money to start investing, Treasury Direct is an excellent alternative.
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CDBs (Bank Deposit Certificates)
In this investment, you lend your money to the bank to use as you wish. This way, after a certain period of time, it will be returned with corrected interest.
A specific positive point of CDBs is the protection of the Credit Guarantee Fund (FGC), which covers up to R$ 250,000 per CPF if the bank that sold the product goes bankrupt.
For this reason, like the Treasury Direct, it is a very good choice for those who are just starting out and want safer and more profitable investments.
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Real Estate Funds (FIIs)
It's a type of investment focused on buying part of a property (or group of properties) and brings together a group of people who have this goal in common. Thus, each investor receives what we call a quota.
In Real Estate Funds, you are guaranteed an extra monthly income from the rent of the properties in your quota and this is not taxed by Income Tax.
However, unlike Tesouro Direto and CDBs, this investment has a variable return, involving more risk and being recommended for those with a more aggressive profile. Therefore, it is essential to do a lot of research before hiring this product and check that it meets your needs.
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Fixed income funds
Fixed income funds are basically the purchase of a share in an investment account, which can be managed by a manager or group of managers. The objective of the person in charge will be to look for ways to ensure better profitability according to the rules of this type of investment.
In fixed-income cases, the money is invested in the most profitable options available on the market. On the other hand, because this service works like this and because most funds are not guaranteed by the FGC (Credit Guarantee Fund), you need to be careful when considering this type of investment.
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Actions
Most people think that shares are the best investment option, but more than any other alternative, they also require a lot of study before being chosen as an investment. What's more, it's a much riskier type of investment, as the company you own shares in could end up going bankrupt one day.
A great tip is to diversify the business segments in which you hold shares. For example, if you have investments in the textile sector, it's also worth investing in other sectors such as food, energy and chemicals. This way, with more than one source of profit, you can avoid further losses if one of the companies goes bankrupt or one segment is having a hard time economically speaking.
Another essential strategy is to look for businesses that are well run, offer above-market returns and have no debts. This analysis is essential to ensure safer investments.
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Conclusion
As we've shown throughout the text, more than just knowing which investments are the safest, it's essential to analyze which ones are best suited to your needs. After all, only with this information about your short- and long-term goals and objectives will it be possible to establish the best choice of investment.
So study up on this subject and know how to devise strategies that are more in line with what you're looking for as a new source of income.
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