Investing, A term that I did not know hardly anything about until I took this class. From what I knew, I thought it was just something that you put money into and then you get more money back somehow, which is kind of it but i’ve come to learn that there is much more that comes with it. When we first learned about investing it sounded like to me its a get rich quick kind of thing, which is possible, if you know what your doing, if you don’t, instead of making money you could lose it, all of it. In the story that Mr.Lindley told the class about his friend and how he made millions on investing his money in Sirius XM radio, that if you smart, willing to take risks, investing can do you a lot of good. If you ask me you kind of have to have some guts to really make a bold decision like that. After hearing that story I wanted to kind of try that same thing for myself when we chose stocks as a class. So I researched the Internet of different stocks that are about to go up. Obviously the highest growing stock was bitcoin but I didn’t want to do it that way. I found 3 different stocks that supposedly are growing at a rapid rate. The first one that I found was Weibo, which I had no clue what it was but I later found out that it a Chinese microblogging website, one of the most popular social media sites in China, in use by well over 30% of Internet users, with a market penetration similar to the United States’ Twitter. So I figured if its like Twitter in the US and fairly new, the amount of growth it possibly could have would be insane. Over the past month although it hasn’t grown very much only about $10 or so. But when I looked at the past year its gone from 44 to 115, five years ago it was at 19. So has it grown quite a bit yes, very fast no. But then that got me thinking. In my situation what if I were to invest right after Graduation and before I leave on an LDS mission, perhaps when I come back that stock could perhaps go up to 200 if I’m lucky, or it could drop too, in my opinion it looks promising. The other two uncommon stocks I choose were not as promising ALRM is the second most promising stock I chose of the three. It has been growing but even slower than Weibo. Since 2015 it has grown from a stock price of $15 to $37. So with my stocks I’d think that within five years or so that I could be making some pretty good money. My next topic on investing Id like to touch on is really what is the best way to invest. One is mutual funds. Mutual funds provides diversification for investors. Diversification is important when it comes to investing. It pretty much means that you’re not putting all of your eggs in one basket per say, but investing in different companies, businesses ,etc. So that you are reducing your risks to failure. Not all mutual funds are alike though, so it’s important to research the stocks and bonds the mutual funds are invested in, the history of the people in your of mutual fund, and the fees that are associated with the funds. I did some more in depth research into mutual funds and found a term that I thought was interesting and have never heard before which was. A pass-through structure, In a sense, mutual fund is the purest form of financial mediator because there is almost perfect pass through of money between unit holders (savers) and the securities in which the fund invests. A Unit holder looks into what type of their funds will be invested. Value of the securities held in the fund portfolio is translated on the daily basis directly to the value of the fund units held by the unit holders.By contrast, a commercial bank is not a pass through type of financial mediator. Banks collect deposits from depositors (savers). The depositors have no specific knowledge of how their funds will be used.Bank invests the monies of the depositors in loans & advances which the bank officers feel appropriate at the time. On the deposits collected banks usually give a specified rate of return (interest) that is not linked to the performance of its loans & advances portfolio. Mutual funds can also be risky at times. I search up what are the most common risks for mutual funds and I found six of the most common risks when investing as a mutual fund. The first one was Market Risk. If The value of its the mutual investment declines because of unavoidable risks it can affect the entire market. The Second one was Liquidity risk. The particular fund could lose money because The fund can’t sell an investment that’s declining in value because there are no buyers, and if there are no buyers you and the people that are in the fund together are stuck. No one will buy a something declining in value and that goes with anything. Third risk is Credit Risk and this type only affects fixed income securities. The stock will lose money if the stock issuer cant repay. Meaning that it possibly could become a completely worthless investment. The fourth one was Interest rate risk, also affecting fixed income securities. The value of the fixed income security will generally fall when the interest rate begins to rise. The fifth risk is Country Risk meaning doing business outside of the US in foreign countries. The value of a foreign investment can declines because of different political changes or some kind of instability in the country where the investment was issued. The sixth and final risk I found was Currency risk and it affects Investments denominated in a currency other than the Canadian Dollar. So if the currency of the money made declines against other countries money such as Canada the investment will lose value. So I just named a ton of reasoning why investing and investing with a mutual fund sounds so bad. But investing is a really good thing, the way I see it if it was so bad, it wouldn’t be a very popular thing right? But it is and many people do very well from it. “The stock market and real estate are the two biggest wealth creators in history,” says Sam Seiden, chief education officer at Online Trading Academy, headquartered in Irvine, California. “Investing in the stock market is much cheaper and easier than real estate for most people.” “Think of it like owning a home versus renting,” says Tim Shanahan, president and chief investment strategist at Compass Capital Corp. Which I interpreted as when you own a home, it’s yours nobody else’s, but when your renting you’re just paying someone to use some place for a while. Investing is not easy either just like owning a home, You make adjustments, make it better and maybe one day when you’ve done your time with it and increased its value you sell for more than you bought it for just like you can with stocks. Invest your money in a stock you think is well worth, wait a while, watch it grow, and just like the analogy with the house. When you’ve done your time you sell it when it’s made more money then when you bought. Magdalena Johndrow, a associate financial advisor for Farmington River Financial Group in Farmington, Connecticut said to start mapping out your goals and risk assessments, and quote, “A lot of investors have a certain perception of what they should be doing,” she says. “A lot of new investors think they should invest 90 or 100 percent in equities because they have a long time to retire.” She later explains how if an Investor so called “risk appetite” is different than their risk tolerance it can really create a problem for the investor causing them to worry or consider pulling their funds from the stock market before there retirement age. Having a mix of other stocks, bonds and other assets must correlate to your risk tolerance so it isn’t keeping you up at night thinking that you’ll fail. The stock market is a good thing and smart because it is designed to go up over time. Because of the 401(k) programs and other retirement plans there are huge investments into the stock market each and every month. Because of those programs it usually forces the prices higher. If the Nasdaq or the Dow Jones average isn’t performing well the stock market exchange just simply removes stocks that aren’t doing well and replaced with it a better one that is growing one. So in conclusion to my Research paper of Investing that Im ending right here because I didn’t realize that Im already at five pages. I’d like the end in saying that Investing is a great and smart plan that I’m excited to purse into in my future.