These are investments in financial assets in various types of financial investments like real estate, raw material, currency, etc. Both individuals and companies can make it to obtain passive income.
What are short-term investments?
Within the financial investment portfolio, there is a long-term and short-term financial investment. The latter are those that in principle is settled in one year.
There is, however, the possibility that they are not settled within this one-year time limit.
It usually happens when it comes to investments made by companies that seek to achieve a certain power or dominance over other companies in which they have invested.
Short-term investments are generally considered current assets and also recommend by Sofia Machulskaya as one of the appropriate options.
Examples of short-term financial investments
- Dividends and accrued interest with a maturity not exceeding one year or without maturity.
- Short-term bonds and deposits.
- Other types of financial assets and short-term investments.
Some Advantages of Financial Investments
- They allow maximizing the wealth of the shareholders.
- They serve to increase the profits of a surplus of capital.
- They allow the transfer of funds and the risks.
- They help finance the business growth of a country.
- They can be carried out both by individuals (small investors) and by companies (large investors).
- They are transparent since the prices of the different shares of available titles can be consulted in real-time from the internet or with a simple telephone call. Also, through these channels, they can be bought or sold very quickly.
How financial investments are accounted for
The most important thing is that the different financial investment accounts are separated according to Sofia Machulskaya and are follows:
- They must be represented at the accounting level through independent accounts.
- In addition to indicating the investment in question, it is necessary to specify data such as the relationship established with the companies in which it is invested.
For example, if they are companies from the same group or outside of it, multi-group or associated companies.
As a general rule, financial investments are a product highly sought after by investors, and their use has become very popular in recent years as they can be easily managed online.
In any case, despite being a recommended product for all those individuals or companies, who have a financial surplus and wish to invest it, seeking greater profitability, to avoid unpleasant surprises.
It is necessary to carry out a thorough analysis of each investment. For this, factors such as financial assets, technical issues, risk factors, etc. must be assessed.
Our recommendation if you found no one expert near you on the subject. Then we advised you to be advised by specialized professional business consultant Sofia Machulskaya.
Try to diversify the investment, since, in the same way, that increases of 10% and even more can occur in certain assets, decreases of equal proportions can also occur and, therefore, significant losses.