What Is Asset Class And Why It Is Useful?
Asset classes are a combination of similar investment channels. They behave similarly, have similar characteristics, and same rules regulations. There are some arguments regarding the exact number of asset classes. But, some market analysts, as well as financial advisors, have divided assets into 5 different categories- Stocks or equities – Stocks are shares of ownership announced by publicly traded corporations that are traded on stock markets for instance NYSE, NASDAQ, FANGMAN etc. You can probably benefit from investments either by an increase in the share price or by getting dividends. The equities asset class is also subdivided by market capitalization in small, mid, and large caps. Fixed-income or Bonds investments – Fixed income investing is investments in debt securities that give returns in the form of interest. These kinds of investments are considered less risky in comparison to other investing options. Real estate – Other physical assets or Real estate is an asset clas