The Wealth Room

Investment Return

How Do Investments Earn Return / Profit? When you start to invest, the money that you will invest is called capital. On the other hand the objects that you own, like a house, shares and Unit Trusts are what we call assets. So the money that you have is capital and the objects that you own are assets. If the price of your assets increase over the period that you own them, your capital that you have invested into the assets will then also increase. You could also get certain assets, (that I call bounce assets) that not only grow in value, but also produce an income stream during the growth phase. The income stream could be means of interest payments or dividend payments if the companies perform well over a particular period. If you combine the capital growth and the income that you