Question

You have $100 to invest and 12 months before you need the money again, but are concerned about losing money. What should you invest in?

Answer 1

There are many financial instruments in which you can invest your money.

• You can save it in a savings account at a bank, which normally offers a very low interest rate. However, the risk involving depositing your money in the bank is barely existent.

• You can also invest in mutual funds. There are different risk categories including "low", "moderate" and "high". The higher the risk, the higher the return. However, if you are concerned about getting your money back, you should pick the "low" category.