Investment VortalsThere are several different type of investment, beyond placing money on deposit, including investments in debts, equity, property and commodities. This web page, and others to which is it linked, list various web pages I have found while researching investments on the internet.
Disclaimer and Warning: The presence of a link within this site is not to be taken as a recommendation for the services provided at that link, or for the corresponding class of investment.
There are several different instruments for investment in debt and equity, including some which give exposure to both debt and equity. They are not equally suitable for any particular individual. One would be well-advised to seek advice appropriate to ones individual circumstances.
All debt and equity instruments are considered riskier investments than deposit accounts, as capital losses can occur.
The base equity instrument is the share. Stock exchanges provide a market for the trading in shares.
Investment research links are divided into the following categories.
Investment Vortals
EquitiesEquity research links are held on a different page.
ADRs,
etcThe shares of a company may be traded on more than one exchange, but in this case what is traded is often not the base share, but some packaged variant. These go by various names - including ADRs (American Depository Receipts), ADSs (American Depository Shares), EDRs (Euro-denominated DRs), GDRs (Global DRs), UKDRs (UK DRs), CDIs (Crest Depository Instruments).
American and Global Depository Receipts are dollar denominated securities tied to the share prices of non-American companies and traded on the American stock markets. Euro Depository Receipts are similar instruments that are denominated in euros.
Not all DRs are conveniently tradeable by the UK retail investor. Given a dollar account with a stockbroker those traded on NYSE and NASDAQ can be bought and sold; this may be a cheaper and more convenient way of dealing in the shares of some companies than on their national stock exchanges. (But note that the shares of a number of foreign companies are traded on the London Stock Exchange.)
Derivatives A future is a commitment to sell or purchase a particular equity, bond, commodity, etc, at a particular time in the future. Futures are a geared investment. This is associated with a greater risk; it is quite possible to lose more than your initial investment.
An option grants the right to sell or purchase a particular equity, bond, commodity, etc, at a particular time in the future. Options are a geared investment. This is associated with a greater risk; it is quite possible to lose the whole of your initial investment.
A warrant carries the right to purchase shares of a company at a predetermined price during particular time periods, and is thus similar to an options contract. Warrants are a geared investment. This is associated with a greater risk; it is quite possible to lose the whole of your initial investment.
A covered warrant is issued by an entity other than the company to which the warrant applies.
Gilts &
Bonds Debt instruments include sovereign and corporate debt. These can be fixed-rate, floating-rate, or index-linked. British sovereign debt instruments are known as gilts, and can be bought through the Post Office, as well as through a stock-broker. Foreign sovereign debt instruments go by different names, such as treasury bonds for United States sovereign debt, but they are collectively known as government bonds. PIBS (permanent interest bearing shares) are building society debt. Corporate debt instruments are collectively known as corporate bonds (junk bonds represent the riskier portion of these instruments). Some corporate bonds are secured upon the assets of the issuer, and others are not; a debenture is typically the former, but one would be wise to check the particular terms of any issue rather than rely on the title.
Some corporate bonds (convertibles) carry the right to convert to equity. These can be considered as a combination of a debt instrument and an equity instrument derivative.
Collective InvestmentsA collective investment is one where money is pooled from many investors, and invested in equities, debts, property, commodities, or whatever. These include investment trusts (ITs), other investment companies, unit trusts (UTs), open-ended investment companies (OEICs), mutual funds, etc. Links for collective investment related sites are to be found on the collective investments page.
TEPsAn endowment policy is a collective investment, historically associated with life assurance policies and mortgages. Endowment policies have a fixed duration. Returns are paid as annual and terminal bonuses; this acts as a mechanism to smooth out volatility in market returns.
Closing an endowment policy early (surrendering) is usually a bad investment; the returns on surrendering a policy are poor. Therefore a secondary market has developed in TEPs (traded endowment policies).
Commodities It is possible to trade in commodities both directly, and by means of futures and options. This can be used either as a hedge or as a speculation. However, for the average investor, information on commodity trading is more likely be of use as an aid to estimating the prospects of companies trading in those commodities.
Foreign
ExchangeIt is possible to trade in commodities both directly, and by means of futures and options. This can be used either as a hedge or as a speculation. However, for the average investor, information on commodity trading is more likely be of use as an aid to estimating the returns on investments in overseas equities, or as an aid to estimating the prospects of companies which have significant overseas earnings and revenues.
PEPs
& ISAs