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- An investment may be defined as a process of sacrificing something now for the prospect of gaining something later.
- Rationally stating all personal investing is designed in order to achieve a goal, which may be tangible (Example, a car, a house, etc.) or intangible(Example, Social status, security, etc.)
- Liquidity, age, need for regular income, time horizon, risk tolerance and tax liability are identified as constraints for an investor seeking fulfillment of the goals stated above.
- The investments can be classified into security form and non-security form of financial investment. Gilt-edged securities, corporate debentures, preference shares, equity shares can be grouped under security form of investments. National Savings Scheme, Public Provident Fund Scheme, Post office savings bank deposits, bank deposits, corporate fixed deposits and Units of UTI can be grouped under Non-security form of financial investment.
- Real investment is the investment intangible or physical goods which are different from monetary assets or financial claims. The tangible assets are — Land and House property, Bullion, Precious stones and Art objects.