When we talk about fixed income or variable income we refer to two classes of concepts that if you are interested in making investments you must know and master to be able to get the best benefits from our money in order to obtain a greater profit with it.
All the two are investments that in the long run will bring you great economic benefits, that is, you will have a profit, but to know which one will be the most appropriate for your money, besides that you do not understand their differences well, we present this article that will help you analyze in detail and get to invest in the way that suits you best for your money.
When we say fixed income or variable income Usually they are talking about financial investments called stocks, bonds, bills, among many more ... But in short, they are the profits generated in the investment that you have made, whatever it has been, regardless of whether it is a form of savings. .
In this case we will focus on these lines to understand and understand what is equities, in order to understand it and know its importance, risks and benefits that we have with it and if it is something suitable for the projects we have in mind for our business and our future investments.
All the equity tools They will always be specifically those that are part of an estate destined for that purpose, in the case of anonymous companies.
The meaning of variability is closely related to the changes that can be made in the total received for the profits obtained
What are equity assets?
Variable income assets are one of the financial tools which can be used in the future It is not fixed, it is not known for sure before, that is, it is closely related to the economic results of the broadcaster.
Equities is a class of investment that is held by financial assets in which the return of capital is not allowed already entered nor its benefits to the asset. When carrying out the variable income, it must be taken into account that the amount of interest that will be paid in the future will be unknown.
The time invested is another thing that is not known, that is, it is not like in fixed income that an end date is given, it does not have an expiration limit or a tool to do so, it only depends on the owner of the investment the make the decision to go ahead or stop it just as there is also the option to sell it. There is no magic way to know when to stop it since as it is always moving there is always this characteristic or latent consequence of the investment that is, not knowing how much will be gained or how much will be lost.
What is the difference between equities and fixed income?
The differences are very easy to understand and distinguish Well, it is necessary to understand well that variable income, of course, unlike fixed income, it will not be possible to know the amounts of the movements that are going to be obtained by the company, even a negative profitable result could be probable in which case there will then be a loss on the investment. This is due to endless profitability factors such as changes in companies, economic status, movements in terms of finance market is concerned and other factors. It is then for this reason that it is called variable because as its name says it changes or is flexible according to various factors that are generated over the time that the investment is being had.
La Equities in stocks is a very good example of dividends that the company must give to its shareholders depending of course on how the transaction is going, explaining it in another way, the interests that are going to have are changing. If shares are bought, this will make a change to co-owner of said company, receiving some rights over it, such as being able to vote, to be provided with information, or participation in the distributed assets, among others.
Another important point that we can highlight as Equities are the investment bases, convertible earnings and preferred shares.
We can say that the equities are the main protagonist or one of the main ones when it comes to the financial market, since fixed income transactions or negotiations are carried out in the financial market, among others.
By not knowing the monetary benefits that they are going to give us, the investment becomes risky in equities, which does not happen with fixed income and not to mention savings deposits that become much more. This is why when making your investment in the Equities are expected to be more productive than in fixed income or savings. But it is important to note that although there is greater profitability and more if it is long-term, it may not always be the best option.
The earnings per year could be, for example, those that are divided into companies and it should be noted that they are usually higher than those that you grants fixed income or savings, but it must also be observed that the share price does not fall because if this is the case, there is a risk of losing the value of the profit.
Otherwise it could also be higher since if the stock increases obviously the profit will be the result of that increase in the stock and performance.
Explained in another way Viable income assets are those whose future payment will be the product of a given task. As could be the example of the actions in which your organization in finance always prevents the payment of profit times, but they are to know what the true results will be because this depends on what the company has invested in this action with respect to the dividend .
The fractions into which the total of money invested from the company Which are legally constituted with the label of a corporation is what we call shares.
Investors dedicated to purchase of shares will become the partners of the companies and for this reason they acquire rights over what is earned in said company as long as it distributes them in the form of returns which consists of the remuneration of the investor.
The most common is that the variable income instruments make their report of monetary benefits obtained in the long term but it will be in exchange for a greater risk.
The most important thing about equities
It is important to emphasize that the shareholders as well as they can have a great benefit, they can have it against it. That is why it is very important that a company is run as efficiently as possible; which will make you more attractive to eyes of the stock market and when this happens the shareholders obtain greater benefits transformed into profits and before society will be more important. On the contrary, if the result is bad, the profits and benefits will go down and obviously they will also be projected in the actions of this particular firm before the stock market.
Now we will explain a way to reduce this risk using diversification, which translates into not investing everything in the same place, but it is recommended that you do multiple split investments in amounts that will be more beneficial to you.
One way to do this is to have some fixed income and other variable income investments, Explained in another way, it will be that you put together a strategy where you include the two types of investment.In this way, there will be a greater investment in equities, on the other hand, if you are not as flexible to cases of risk, the best way will be investment fixed income.
It's a matter of analyze the pros and cons of each type of investment that we propose and it is also important to think about what you want to achieve in the future, the needs and characteristics of your business, as well as the ability to withstand those good and bad changes of variable investment that well, well they say that nothing ventured nothing gained; wave fixed income option where you feel better to be in a comfort zone that although with little performance, it always ensures to give results in its favor.
We hope this article has been helpful, we have cleared up doubts and helped you choose the decisions that always improve your financial benefits. Now that you know this investment, its characteristics and how it works, it is a matter of putting cards on the table and carefully analyzing if this risk will be taken that will lead your money and company to have a better projection and benefits because obviously this will be reflected if you take the best decision.
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