Financial instruments are essential tools for investors. They provide opportunities for capital appreciation, income generation, and diversification.
Benefits of Financial Instruments in Investment:
- Capital Growth: Stocks and real estate can appreciate over time, increasing investor wealth.
- Income Generation: Bonds and dividend-paying stocks provide regular income.
- Diversification: A mix of different instruments can reduce risk in a portfolio.
- Liquidity: Many financial instruments can be easily bought or sold in the market.