Investment Products to Consider

by admin on September 11, 2011

Investment products refer to financial products which are purchased with the aim of earning a profit. They are of two types: more speculative, as options and stocks, and income-producing, for example, fixed-interest products. There is a wide variety of investment products, including annuities and ETFs, mutual funds and bonds, futures, options, stocks, money market investments, and certificates of deposits. Investment products are offered to institutional and individual investors who aim to generate profit. Certain bonds and other investment products come with fixed interest payment. Investing in stocks is riskier, however, because earning a profit is not guaranteed. If you are looking for investment products on the US financial markets, you may consider buying a portfolio of investment products as to manage risk.

If you are looking for investment products offered by a US bank, you can check the product selection of First American Bank. You can choose from annuities, mutual funds, and IRAs. Through UVEST Financial Services, the bank offers to its clients fixed annuities. They come with a number of benefits, including guaranteed death benefit, safety of principal, competitive rates, tax deferral, and a chance to generate lifetime income. Another option is to invest in variable annuities, which represent long-term tax-deferred investment solutions. They have insurance and investment components and are intended for retirement purposes. Variable annuities are featured with a number of benefits and services, including riders, death benefits, and living benefits. As an added guarantee option, most riders go with additional charges, fees, and restrictions. IRAs are another type of investment product to consider. They are available in two varieties – traditional IRAs and Roth IRAs. The traditional kind is an account that helps clients make the most out of tax-deferred investment growth. With Roth IRAs, contributions will not be tax deductible, but if you are 59 ½ years old and hold this account for five years, distributions are tax free.

Part of the Wells Fargo Company, Wachovia Bank also offers investment products to its clients. Investment choices include options, mutual funds, annuities, bonds, stocks, and unit investment trusts. The latter term refers to a fixed portfolio of securities, chosen by professionals. There are three types of unit investment trusts. The equity type aims to offer a combination of dividend income and capital appreciation by means of investment in equity securities. Portfolios normally fall in one of three categories – index trusts, sector trusts, and strategy trusts. The tax-free fixed income variety represents a portfolio of municipal bonds which provides semi-annual or monthly income. This income is not subject to federal income taxes. Finally, the taxable fixed income variety is a portfolio containing corporate, U.S Agency, and U.S Treasury issues that offers a semi-annual or monthly income. Beneficial features of these portfolios are income diversification, professional selection, low minimum investment in the amount of $1,000, and scheduled maturity. Daily liquidity is another beneficial feature because if the trust is sold before maturity, it might be worth less or more than its original value. All sales charges that are outstanding are deducted at redemption.

In general, investing in a portfolio is a good risk reduction strategy. With portfolio investments, you can buy shares in foreign companies, acquire assets in other countries, buy stocks of foreign businesses, and buy bonds which were issued by foreign governments. The factors that may affect portfolio investment are various in nature. They include tax rates on dividends and interest, exchange rates, and interest rate, considering the fact that money flows from countries with low interest rates to counties with high interest rates. With regard to exchange rates, foreign investors tend to prefer local currencies that are expected to strengthen.

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