How do fixed income investments work and why are they profitable?
The order of investors wants to know in advance how much money the investment will make them. This is why fixed interest investing exists. Read what are its advantages or how it differs from variable income investing.
(This article is NOT financial advice)
What is Fixed Income Investing?
It is not necessary to enter investing with the worry of whether it will eventually bring profit. How is that possible? Thanks to fixed income investments that are ideal especially for investors preferring lower risk and long-term predictable income.
For fixed-income investments, always predetermined interest, the amount of which does not affect the market performance of the asset or other factors. Put simply: the investor gets a negotiated return on the investment, no matter what. Even if the market price of an asset falls or rises by tens of percent, interest remains unchanged.
The investor then receives the return on investment at regular intervals, namely throughout the investment. For example, for projects on Investown, the investment period is 12-18 months, with the investor receiving a return every month.
For fixed-income investments, there is always a predetermined interest, the amount of which does not affect the performance of the asset or other factors.
Investing in fixed valued assets looks like this in a nutshell:
- The issuer discloses an investment on the market, for example, in the form of a loan secured by real estate or bonds. In the information about the investment, it indicates how much the return is (% p.a.) and how often it will be paid to the investor.
- In the course of the investment, the investor regularly receives the agreed interest.
- After the end of the investment, the investor receives back the originally invested amount.
An issuer refers to any entity that issues financial products (typically securities) intended for investment. As a rule, the issuer uses the money raised from investors to finance its further activities.
What are the benefits of fixed-interest investments?
Fixed-interest investments give the investor a high degree of certainty and predictability of income from the start, while in the case of variable interest investments the situation is the opposite. The yield depends on the performance of the asset or the current market situation, possibly throughout the economy.
Thus, in the case of investments with variable returns, the investor does not have a guaranteed profit or its amount in advance, and in the event of an unfavorable development, it can also end up in a loss. A typical example of assets with uncertain returns are stock, cryptocurrencies or commodities like gold and silver.
Regular and predictable income is the reason why Fixed-value investments pay the most for long-term investments, for example, at a duration of 24—36 months. The investor receives fixed interest all the time and does not have to deal with market fluctuations, at the same time he takes only minimal risk.
The great advantage of fixed yields is also time savingbecause the investor does not need to check several times a day how his investment is doing.
Regular and predictable income is the reason why fixed-value investments pay off the most for long-term investments.
Fixed valuation brings all projects to Investown
Because fixed income is profitable in the long term and provides investors with income stability and peace of mind, we offer on Investown for all investment opportunities. In addition to the amount of fixed income, investors know in advance the maturity of the investment, so they know how long they will receive interest.
Investing in real estate at Investown brings fixed appreciation up to 10,5% per annum.
Attractive project with fixed interest and a fixed yield of 10.1%
Investors at Investown are currently valuing their money, among other things, as part of an attractive real estate project Residence Tri Dvory from the major investment group DRFG, the investments will bring them a fixed return 10,1% per annum.
This is an investment with Maturity of 18 months, which aims to promote the development of Brno's surroundings and enrich civic amenities. The project remains open for investment, so you too can value the money in it.
This article is not investment advice
Investown does not provide investment advice. This is an educational article with basic information on investment income. For specific advice, we recommend using the services of an investment advisor.
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