Guaranteed Returns investments

Who doesn’t love a promise? From 30-day money back to promised customer satisfaction, as a culture, we have become almost too used to such things and many individuals spill over the same concept to financial investments and ask for a guaranteed return investment. While it is theoretically possible to have these, a certain amount of risk and volatility cannot be ignored. Nevertheless, the following investment products could be truly classified as a guaranteed return investment:

Liquid investments

Certificates of deposit, money market accounts, and other interest-bearing instruments could be classified as truly a guaranteed return investment, although these returns are lower than their other investment counterparts.

Bonds

Both savings bonds (issued by the US Treasury) and corporate bonds offer a fixed rate of return in the form of interest rates. There is some amount of volatility associated with corporate bonds, but overall bonds do position themselves as such choices.

Long term retirement investments — guaranteed return investment

Additionally, long term retirement choices, such as annuities, pension funds, 401 (k) plans, IRAs, and other similar vehicles also position them as guaranteed return investments, although you must read your contract’s fine print to determine if these are truly what you are looking for.

Mutual funds

Mutual funds are professionally managed and while some funds, especially index funds, do promise some of a return, there are many fluctuations that go into play. The same holds true for REITs (Real Estate Investment Trusts) and other form of index funds as well.

Index funds

An index mutual fund is an excellent example of index funds. The mutual fund could promise to replicate a major stock market index, such as the S&P 500 so your return would essentially be at par with overall market performance and a fixed some would be deposited into your account every month. If the market does not perform optimally, you will be unable to realize any gains and if the market does then you will reap monthly income. The reverse holds true as well and you could make more passive income if the market were to spike. The disadvantage of this strategy, however, is that you will always be closely tied to the market’s performance and it will be rarely possible to outperform markets so while these funds returns tied to a certain index, that index itself may not promise a certain level of return or performance. It is always best to have investment tracking software that will help you understand just what your money is doing.


Disclaimer: This article is not intended as investment advice. You must check with a qualified professional before making any investment decision.

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