The Five Types of Assets You Might Own (Stock Market)

April 1, 2009

Generally, there are five types of assets the average investor is likely to own in their lifetime:

1.Common stocks – ownership of businesses

2.Preferred stocks – special types of stock that often pay high dividends but have limited upside

3.Bonds – corporate bonds, municipal bonds, savings bonds, U.S. government treasuries, etc.

4.Money markets – highly liquid funds that are designed to protect your purchasing power; considered to be a cash equivalent

5.Real estate investment trusts or REITs – a special type of company designation that allows no taxation at the company level provided more than 90% of earnings are paid out to the shareholders. The assets are often invested in a variety of real estate projects and properties.

6.Mutual funds including exchange-traded funds, index funds, and actively managed funds.

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