Greetings, dear blog readers. I talk a lot about what investments are and how to create capital, but today I want to tell you what is investment capital, what it is like and what types it is divided into.

And to understand capital, let's once again define what investment is. Investment is using money to further increase capital or generate income.
All types of intellectual and property values ​​that are invested directly in objects entrepreneurial activity and other types of business with the aim of further achieving a social effect and making a profit are precisely investments.

Based on the above, investment capital is a tool that allows you to achieve the desired economic result through its investment. We can say that investment capital is not money in the direct sense, but a tool.

There are several more definitions of capital that I would also like to present here.

Capital- is a combination of material, intellectual and financial resources used to generate profit and additional material benefits.

Capital– this is what is invested in the business and generates income. It can be either money or intangible assets. The main thing is that they generate income.

Here interesting definition, which not only reflects the essence of capital, but also its tasks and opportunities for the owner.

Capital is created through savings, which increase the possibilities of consumption in future periods due to a relative reduction in current consumption. In this regard, individuals who save compare current consumption with future consumption.

What type of investment capital is there?

1. Own investment capital- this is free money accumulated or received in the form of income that is invested.
2. Debt investment capital- this is free money, but someone else’s (loans, borrowed money, etc.).

An interesting point - your personal money is not capital. But they can become one when you decide To invest money in certain investment instruments.

There are several types of capital that investors need to know and understand. Yes it general information, but it is important.

The following types of capital are distinguished::

• real capital (buildings, structures, machines, copyrights),
• financial capital (cash, securities, savings)
• human capital (labor resources, investments in their education, etc.). Real capital is also divided into fixed capital and working capital.

My personal task, and the task of anyone who creates capital, is to receive income from it. This is not only logical, it is correct. Why else, then, should you put aside, save, invest, deny yourself something, perhaps, just to make a profit from the accumulated capital?

Add to the chat, I will be glad to communicate - Chat for investors! Ask questions, share your experience!

Investment capital

Market valuable papers serves as a critical source of investment resources for governments, corporations and banks.

The term "investment" has several meanings. In the literature you can find various definitions of it. The most general definition can be considered the definition of investment as the use of money for the purpose of generating income or increasing capital. All types of property and intellectual assets that are placed in objects of entrepreneurial and other types of activity in order to make a profit or achieve a social effect are investments.

Already from this definition, we are talking not just about money, but about money, which is the monetary form of the circulation of capital, that is, investment capital. Investment capital can be your own ( retained earnings, depreciation charges) and borrowed funds, the source of which is temporarily free other people's funds. But free cash is not an investment. They turn into investments in the hands of those who spend them on the purchase of elements of production, generate income, that is, turn them into real assets. Real assets are economic resources companies: main and working capital, intangible koshtis1 used for production activities for the purpose of generating income. Own savings, turning into real assets, directly turn into investments. Other people's free funds (savings) are converted into investments through the capital market, primarily through the stock market.

Investment objects can be real investment projects, real estate and various financial instruments. Financial instruments as investment objects are different types financial obligations:

§ deposits in the bank;

§ securities (bonds, shares, options, etc.). So, the term "investment" is used to mean:

a) attachments Money, intellectual values ​​into real assets, that is, into production;

b) investing funds in financial instruments, that is, purchasing securities.

The ratio of own and borrowed sources of investment financing is called financial leverage.

In this chapter and further, investments will be understood as investments in financial assets, and not into production. In other words, we will treat investments like any financial instrument, in which you can place money, hoping to preserve or increase its value and provide a positive amount of income.

Investor- this is the tone of someone who, when purchasing securities, thinks primarily about minimizing risk.

Unlike investors, a speculator is willing to take calculated risks, while a gambler is willing to take any risk.

Securities or stock values ​​are investment instruments that represent someone's debentures or providing the right to participate in the company as an owner. On this basis, they are divided into portfolio investment and direct investment (FDI). Portfolio investment consist of short-term investments (credit notes, etc., with a maturity of one year or less) and long-term investments (purchase of shares in a foreign enterprise that is not owned or controlled by the investor). Direct foreign investment- This long-term investments for a term of more than one year or perpetual (purchase of bonds and shares in a foreign enterprise that is substantially owned or controlled by the investor). So, investments are associated either with the interests of the lender (portfolio), or with the participation of capital as an owner (direct). Thus, they distinguish:

§ real and financial investments;

§ public and private investments;

§ short-term and long term investment;

§ direct and portfolio investments.

Main goals of investors:

§ investment security;

§ increase in current income;

§ saving funds for large expenses; “Saving funds for the retirement period;

§ growth of investments;

§ concealment of income from taxes;

§ liquidity of investments.

Investment security means the invulnerability of investments from shocks in the investment capital market and the stability of income generation. Security usually comes at the expense of profitability and investment growth. Investments in government bonds are considered the safest. The most risky - investments in shares of a young science-intensive company, can be the most profitable in terms of profitability and investment growth. Maximizing return on investment is usually associated with low level security.

The optimal combination of security and profitability is achieved by careful selection and periodic revision of securities.

Only holders can increase investments ordinary shares. For stocks, only a portion of the capital gain is credited to the investor's income and is subject to ordinary income taxes.

Interest in capital growth has given rise to a whole class of securities called growth securities. The main types of income are the right to tax benefits are interest on tax-exempt municipal bonds and Treasury securities and income on tax-sheltered stocks. Fixed income gives an annuity - a rental contract that gives the annuitant the right to receive a lifelong annuity.

Some investors prefer liquidity or marketability when selecting securities. Liquidity refers to the ability to quickly and without loss for the investor convert securities into money.

No security has such qualities that would ensure the achievement of all of the listed goals. The mechanism of the securities market works in such a way that when securities are truly reliable, the yield will be low, since an increase in demand for them will raise the price and bring down the yield. The relationship between such qualities of securities as the prospect of capital growth and profitability is similar.

The optimality of the securities portfolio is achieved by diversifying investments, when capital is distributed between the number of different securities, as well as by regular review of the portfolio. It is customary to limit investments in one type of securities to 5-10% of total cost portfolio.

Capital investment is a type of activity in which you can make a profit from the invested funds. In other words - your money should work for you.

This approach should radically change your idea of ​​how to earn money. Many people see no alternative to making money other than going out and getting a job. This has been instilled in us since school.

But to earn a lot you need to occupy a high position at work, and reaching the position of director is not so easy.

Of course, not everyone can reach the level of Warren Buffett, but anyone can earn decent money by investing capital. Let's figure out what can be classified as investing.

Objects where you can invest your capital

• and other securities

• Own business

It is impossible to say unequivocally where it is better to invest. Some people are better able to make money on antiques, others on, etc.

Successful capital investment requires good knowledge in the field. First you need to invest in your knowledge and then start practicing. Many people at the beginning of their journey lost all their money and no longer wanted to invest. All due to the fact that there was little theoretical knowledge.

When you have already studied a lot of information, you can move on to practice. You can invest without leaving your home. To do this, just select good broker, open an account and choose what you will invest in.

2008-2009 was a rather sad date for global finance.

International financial crisis led to the fact that many banks went bankrupt, financial and Insurance companies did not stand aside.

• - The only one with a license from the Central Bank of the Russian Federation. invested $20,000
• - Best. Operating since 1998. invested $20,000
• - This is a Swiss bank with access to Forex! 18 000 $
• - I have been working with him since 2007. invested $10,000
• - They give you a bonus of 1500 USD. invested $10,000
• - the best cent account. invested $8000
• - For scalping, he’s the only one AND THAT’S ALL! 8000 $
• - $30 GIVEN TO EVERYONE NEW! invested $5000
• - $30 GIVEN TO EVERYONE NEW! invested $5000
• - THIS IS NeftepromBank. invested $5000
• - I use it as binaries via MT4. Invested $5000

But we discuss everything in a closed group, more precisely in secret Forex forum ! There are a lot of traders, financial bloggers, brokers and beginners there! Let's discuss what works and what doesn't! Join us, the more of us, the easier it is! See an example of personal income

To get closer to understanding such a concept as investment capital need to figure out what economic environment this concept belongs, and what goals and objectives it serves.

Usually, investment capital created by an enterprise or another economic entity to implement investment activities. in turn, is aimed at receiving and extracting income, both in material and non-material terms, from the investments made.

Thus, investment capital is a tool that allows you to achieve the necessary economic result through its investment.

Investment capital can be formed at the expense of own or borrowed money, and it can also be of a mixed nature (the capital structure will contain both its own and funds raised from outside).

Own funds is the organization's retained earnings, as well as depreciation charges, profit from the sale of securities of companies of which you are the owner, profit from the sale of unnecessary or non-core assets, profit from leasing, etc.

Sources for the formation of borrowed funds can be loans and borrowings, attracted funds of strategic and other types, grants for government funding and much more.

It is worth noting that not all available cash and other types of funds are investment capital. Such funds are investment capital only if they are invested in assets that can bring the necessary economic effect, or when they acquire assets that can generate income. In other words, the acquisition of assets for investment purposes.

Investment capital formula

Based on the statement that investment capital is a set of own and borrowed funds aimed at making investments in order to make a profit, it takes the following form
IR = Ano + Pnch + Abp
Where, IC is investment capital.
Ano – actual amount depreciation charges.
Pnch – actual size unallocated net profit.
Abp – size depreciation funds, transferred on loan with the condition of their return upon demand.

Ano = Anp – Apn – Abp
Where, Anp - total amount depreciation charges for reporting period.
APN – the amount of depreciation used for the reporting period.
Abp – the amount of free depreciation funds (including those transferred on debt).

Pnch = Poch – Prch
Where, Poch is the total amount of retained net profit for the reporting period.
Prch – the amount of distributed net profit for the reporting period.

It is also worth considering that investment capital can be formed from raised funds, in particular loans and borrowings, in this case investment capital formula takes the form
Sik = IR + Kz (Kb) + Zp
Where, Sik - mixed investment capital, Ik - investment capital, Kz - loan with collateral, Kb - loan without collateral, Zp - loan from business partners.

Our whole life is a continuous game. Appearing as children, parents, pupils, students and simply good people, we play one role or another. This role is characterized by certain rules of behavior and norms, within the framework of which you will either be a good parent, or a worthy student, or students above all praise. If we translate this into our area, then since you are going to become a successful investor, then in order to competently play this role, you need to study and accept fairly simple, but very effective rules for investing capital.

So, the rules for investing capital that you need to remember:

1. Determine your investment goal. Surely you are an adult, conscious person, and any of your actions is one way or another supported by motivation. You must have a clear answer to the question “Why do you need this?” Yes, we have already made an analogy many times in which we said that investing is a game. But, do not forget that this game is for money. And with your money. Therefore, before you make the final decision to invest even $1 in order to increase it, still think about what the real goal of your intentions is.
2. Create investment capital. If you have decided on your investment goal,that is, they answered the question “why?”, then it makes sense to think about another question “what?”. What will you invest for profit? How many? Again, take your time to answer. After studying the topic, you will understand that this process may entail the loss of all invested funds. The only logical conclusion follows from here: invest exactly as much as you are willing to lose. Yes, this doesn't sound very comfortable. Moreover, you may never have significant losses. But the rule is the rule - your investment capital should consist only of those funds that, in case of loss, will not affect your well-being. If this amount is $10, it’s okay, and you can start the investment process from this level.
3. Never invest with borrowed/leveraged funds. If you understand the previous rule, then this point will be absolutely clear to you. Loss of borrowed or credit money is the worst thing an investor can do. Avoid investing with borrowed money. Remember - investing is a process of improving your well-being, not balancing on the brink of chance.
4. Diversify risks. In other words, don't keep your eggs in one basket. Your investment capital, depending on its volume, should always be distributed among several investment objects. Never chase after the most advantageous offer, investing all the funds there. Recent history shows many collapses of even the largest banks and financial organizations. So always choose various options capital increase.
5. Constantly set aside a portion of your profits. If you have accepted the first rule “Define your investment goal,” then you must understand that some part of the funds received should go towards achieving this goal. Well, of course, part should go to stabilization fund, so that you always know that a certain amount is available “just in case”. The opinion of all large investors agrees that it is necessary to save at least 10-15% of the income received. This money should be inviolable to meet general needs, its purpose is to achieve your goals and accumulate capital.
6. Be selective when choosing investment proposals. There are many factors that allow you to soberly assess a particular opportunity for increasing capital. But the most important thing is to understand that not all that glitters is gold. The lack of guarantees as such and constant economic instability indicate only one thing - always carefully study the proposal you receive, and be sure to check the opinion of specialists.
7. Constantly improve your skills. Stagnation is the first sign of degradation. Speaking in simple language, even if you are already a successful investor and have carried out a couple of profitable transactions, do not relax. The world does not stand still, and if you stop developing, you will be left far behind. Actually, this is the basis for constant personal growth and improvement of your well-being.
8. Always follow the rules of investing.