I’m Steve Ember with the VOA Special English Economics
Report.
Stocks, bonds, land -- people invest
in different things and for different reasons. But all investors share the same
goal. They want to get more money out of their investment than they put
into it.
The money they invest today provides capital for future growth in the
economy. But people can watch their own financial future take a wild ride as
markets rise and fall. So investors have to decide how much risk they are
willing to take and for how long.
One choice for people who want a low-risk investment is the money market.
Usually individuals do this through money market mutual funds. Mutual funds are
investment pools. They gather the money of many investors.
Money market mutual funds earn interest from short-term loans to government
and businesses. But the return to investors is low because little risk is
involved.
Notes and bonds are loans, too. They have terms from two
to thirty years. The longer the term of a loan, the greater the risk that the
investment will not be repaid. So notes and bonds usually pay higher interest
rates than short-term bills or commercial paper
.
Millions of people invest in bonds and other debt-based products. This is
true especially as people get older and want to reduce the level of risk in
their investments.
But over time, debt-based investments have traditionally provided lower
returns than stocks. Stock is a share of ownership in a business.
Common stock gives investors a vote on company issues and leadership. It
might also pay a small percentage of its value, a dividend, one or more times a
year. Not all stocks pay dividends. Some are valued more for their growth.
Technology stocks, for example, rarely pay dividends.
Preferred stock is different from common stock. Holders of preferred stock
have no vote on company issues, but they also have less risk. They get paid a
stated dividend before the company even considers paying dividends on common
stock.
Investing in stocks of individual companies can be very risky. Bad news can
quickly cut their value. Instead, many people invest in stock mutual funds so
their money goes into many different stocks. Balanced funds mix stocks and bonds
to spread risk -- and capital -- even more.
This VOA Special English Economics Report was written by Mario Ritter. You
can read a transcript of this report and download the audio at
voaspecialenglish.com. I'm Steve Ember.
commercial paper:商業票據
（來源：VOA 英語點津姍姍編輯）
