Investing

5 Key excerpts on "Investing"

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  eBook - ePub

  Project. Program. Change

  • Roland Gareis, Lorenz Gareis(Authors)
  • 2018(Publication Date)
  • Taylor & Francis

    (Publisher)

  The contributions made by projects to fulfilling the strategic objectives of an organization must be communicated to the members of the project organizations and to the project stakeholders. This is a project management responsibility. This creates “sense” and contributes to motivating the members of the project organizations.

  On the other hand, project results also influence an organization’s strategic objectives. The relationships between an organization’s strategic objectives and projects are shown in Figure 3.3 . Managing these relationships as part of project portfolio management is also a task of strategic managing.

  Fig. 3.3 : Relations between strategic objectives of an organization and projects.

  3.2 Investment Definition and Investment Types

  Investment Definition

  In the literature, an investment is defined as the transfer of capital into fixed and current assets.8 In fiscal terms, an investment is understood as a process which is characterized by a series of cash outflows and a series of cash inflows.9 The predilection for the fiscal definition can be explained by its operationality. It allows traditional investment analysis methods to be used as a basis for decision making.

  Here an investment is understood as a chain of business processes required to ensure an organization’s capacity to provide services. For this not only fixed and current assets are necessary, but personnel and organizational competencies must also be created, and medium-term to long-term collaborative relationships with stakeholders must be established.10

  Investments may relate to various objects—namely, to a product or service, a market, the organization, the personnel, the infrastructure, the financing, and a stakeholder relation. Therefore, unlike in accounting, the definition of an investment used here is not limited to depreciable fixed assets.

  Definition: Investment

  An investment is defined as a chain of business processes required to ensure an organization’s capacity to provide services. A differentiation may be made between product or service-related investments, market-related, organization-related, personnel-related, infrastructure-related, financing-related, and stakeholder-related investments.

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  Investing For Dummies

  • Eric Tyson(Author)
  • 2020(Publication Date)
  • For Dummies

    (Publisher)

  Ownership investments are those investments where you own an interest in some company or other asset (such as stock, real estate, or a small business) that has the ability to generate revenue and profits. Observing how the world’s richest have built their wealth is enlightening. Not surprisingly, many of the champions of wealth around the globe gained their fortunes largely through owning a piece (or all) of a successful company that they (or others) built. In addition to owning their own businesses, many well-to-do people have built their nest eggs by Investing in real estate and the stock market. With softening housing prices in many regions in the late 2000s, some folks newer to the real estate world incorrectly believe that real estate is a loser, not a long-term winner. Likewise, the stock market goes through down periods but does well over the long term. (See Chapter 2 for the scoop on investment risks and returns.) And, of course, some people come into wealth through an inheritance. Even if your parents are among the rare wealthy ones and you expect them to pass on big bucks to you, you need to know how to invest that money intelligently. If you understand and are comfortable with the risks and take sensible steps to diversify (you don’t put all your investment eggs in the same basket), ownership investments are the key to building wealth. For most folks to accomplish typical longer-term financial goals, such as retiring, the money that they save and invest needs to grow at a healthy clip. If you dump all your money in bank accounts that pay little if any interest, you’re more likely to fall short of your goals. Not everyone needs to make his money grow, of course. Suppose that you inherit a significant sum and/or maintain a restrained standard of living and work well into your old age simply because you enjoy doing so. In this situation, you may not need to take the risks involved with a potentially faster-growth investment.

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  Investing in Stocks For Dummies

  • Paul Mladjenovic(Author)
  • 2023(Publication Date)
  • For Dummies

    (Publisher)

  Which one do you want to do? Knowing the answer to this question is crucial to your goals and aspirations. Investors who don’t know the difference tend to get burned. Here’s some information to help you distinguish among these three actions: » Investing is the act of putting your current funds into securities or tangible assets for the purpose of gaining future appreciation, income, or both. You need time, knowledge, and discipline to invest. The investment can fluctuate in price, but you’ve chosen it for long-term potential. » Saving is the safe accumulation of funds for a future use. Savings don’t fluctuate and are generally free of financial risk. The emphasis is on safety and liquidity. » Speculating is the financial world’s equivalent of gam- bling. An investor who speculates is seeking quick profits gained from short-term price movements in a particular asset or investment. In recent years, many folks have been trading stocks (buying and selling in the short term with frequency), which is in the realm of short-term speculating. These distinctly different concepts are often confused, even among so-called financial experts. I know of one financial advi- sor who actually put a child’s college fund money into an inter- net stock fund, only to lose more than $17,000 in less than ten months! For more on the topic of risk, head to Chapter 4. CHAPTER 3 Defining Different Approaches to Stock Investing 33 Chapter 3 IN THIS CHAPTER » Pairing stock strategies with Investing goals » Deciding what time frame fits your investment strategy » Looking at your purpose for Investing: growth versus income » Determining your Investing style: conservative versus aggressive Defining Different Approaches to Stock Investing “ I nvesting for the long term” isn’t just some perfunctory investment slogan from a bygone era; it’s just as valid today as it was long ago. It’s a culmination of proven stock-market experience that goes back many decades.

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  Wiley Pathways Personal Finance

  Managing Your Money and Building Wealth

  • Vickie L. Bajtelsmit, Linda G. Rastelli(Authors)
  • 2012(Publication Date)
  • Wiley

    (Publisher)

  1. List the seven steps of the investment planning process. 2. List your financial goals. 3. Name some ways to find money in your budget for Investing. S E L F - C H E C K 11.2 UNDERSTANDING YOUR INVESTMENT ALTERNATIVES 285 One of the basic principles of finance is that the lower the risk, the lower the return. Your bank savings account, for example, is a very low-risk, federally insured loan made to your financial institution. In return for your deposit, the bank promises to pay you regular interest on your savings and to return your funds to you upon request; however, because the risk is so low, the interest rate the bank pays is very low as well. In contrast, if you lend money to the gov- ernment or to a business and commit your funds for a long period of time for the loan (often 20 years or more), you’re exposed to greater risk and are therefore paid a higher annual rate on the debt investment. Although debt investments offer the security of receiving regular cash flows, their rates of return in general tend to be lower than those of some of the other investment alternatives. If you lend to a business, and the business later becomes very profitable, you do not have a right to any of the profits, as you would if you were an owner. As a lender, you don’t share in the company’s good fortune except insofar as it reduces the risk that you won’t be paid what you’re owed. 11.2.2 The Advantages and Disadvantages of Owning If you’re an entrepreneur at heart, you can invest by owning a business. This, of course, requires certain skills and a substantial investment of time and money. Alternatively, if you want to share in the profits of a business without having to run the business yourself, you can become a partial owner of a company and allow others to manage it.

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  Investing Explained

  The Accessible Guide to Building an Investment Portfolio

  • Matthew Partridge(Author)
  • 2022(Publication Date)
  • Kogan Page

    (Publisher)

  01

  The basics of Investing

  Summary

  Investing is putting your money to work so that it grows. To do this you need to work out your financial goals, sort out your finances so you can start saving regular amounts of money and then start Investing it in assets like shares and bonds (with the balance between the two depending on your investment horizon). Over time, such a strategy should ensure that you can accumulate sufficient money to more than meet your needs. This is particularly important in the case of retirement because, with firms providing less generous pensions, and governments around the world constantly increasing the retirement age, you will need to take responsibility for your financial future.

  1. Why do I need to bother with Investing?

  Whenever I reveal to people that I’m a financial journalist, I get one of three reactions.

  Some people try and get me to reveal the secret of making a fortune in the stock market. Others start ranting about their bank, or the latest financial scandal, as if I’m responsible. Finally, some people’s eyes glaze over and they politely say ‘that sounds interesting’ before changing the subject. (Though one person has been blunt enough to simply say, ‘What a boring job.’)

  Obviously, I don’t agree with this last sentiment, since I find following the twists and turns in the financial markets fascinating. But it’s true that, to quote Nicholas Cage in Matchstick Men, ‘For many people, money is a foreign film without subtitles.’ And there’s nothing wrong with that. However, there’s no escaping the fact that sticking your head in the sand about money isn’t an option in today’s world.

  Unless you’re planning on living like a monk, you will have financial goals. That could be to enjoy a comfortable retirement, or to buy a house, or to go travelling, or to pay for school fees (or all of the above). And if you want to meet those financial goals, there’s no way round it: we have to make our money work for us.

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