Investment - Indonesia's Popular Investment Type
Netgenz - Stock | Investment is a step to protect and increase wealth. Various types of investments also exist and can be decided according to your investment direction. Compared to some developed countries, the interest of Indonesian citizens in the investment world is still low. The low interest in investing in Indonesia cannot be separated from the number of community groups who have the opinion that investment is only for a few rich people.
However, the pattern continues to change. Investment is now more easily achieved by people with lower middle income. This has a major impact on the development of investment in Indonesia. The teaching of finance is getting more and more even, which also increases the awareness of the people about the virtues of investing.
Short-Term Investment versus Long-Term Investment
The number of investment instruments available provides more options for several investors. But it should be understood, not all investment instruments are suitable for all investors. Many things are common to be considered when choosing an investment instrument. In addition to the investment direction and the investor's risk profile, you also need to consider the investment period.
Judging from the period, investments can be divided into two groups. The two are short-term investments and long-term investments.
1. Short Period Investment
This type of investment has a fairly short period with return results that can be seen after 3 to 12 months. This type of investment is often referred to as temporary investment or just to secure the funds you have while waiting for other investment opportunities to have a maximum return.
There are at least 2 characteristics that make an investment instrument a short-term investment. First, the investment must be of high quality. Second, the investment instrument must be wholly liquid and easily re-marketed.
Although at first glance short-term investment looks very good, it has one drawback. Compared to long-term investments, short-term investments have relatively lower returns. There are several kinds of investments that go into this group. One of them that is quite well known is mutual funds.
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2. Long-Term Investment
Each investment instrument that enters this group takes several years to start generating returns. Often, an investor must dampen and hold this investment for up to ten years before selling it and realizing a return. In fact, quite a lot of long-term investments are simply bought without being re-marketed.
Although it takes a longer time to generate returns, long-term investments usually have a maximum return than short-term investment types. But as a risk, the risk that is guaranteed is usually higher.
To optimize the power of long-term investments, you must have a fairly large capital. In addition, you must also receive evidence that a long-term investment may continue to be unprofitable for the first few years. Therefore, it is necessary to analyze sufficiently in time before choosing to take this type of investment. There are quite some investment instruments that fall into the long-term investment group. One of them is quite famous is a stock investment.
Famous and profitable investment instrument options in Indonesia
As previously discussed, based on the period, investments can be divided into two groups, namely short-term and long-term investments. Both have their advantages and disadvantages. But, what investments exist and provide benefits? Here are some investment instruments that are quite well known in Indonesia.
Actually, this deposit is similar to savings. The low risk makes deposits often decided by novice investors. But when compared to savings, two things compare it, namely the interest rate and the time to maturity.
Deposit interest rates are higher than ordinary savings rates. In general, the interest is in the range of 5-6% / year. Several banks offer interest rates of more than 6%. The more money you invest, generally the higher the deposit interest. When you open a time deposit account at HSBC, the returns you can get include the interest of 6.25% / year and a
cashback of up to IDR 100 million which is the same as a total return of up to 7.25% for Rupiah deposits. Even though they have higher interest rates, the money you invest in deposits cannot be withdrawn all the time like savings. There is a binding tenor. The moment before the deposit is due, you can't even touch it.
The tenor of the deposit itself is quite diverse. Each bank has its own rules because of that. But in general, the average bank provides an optimal tenor of 12 months. Even so, several banks offer deposit tenors of up to 24 months.
For those of you who are more interested in the type of physical investment with a lighter intrinsic value, gold can be a pretty attractive option. Just like with deposits, the risk of investing in gold is low. The value tends to be constant and continues to increase every year.
If you want to invest in gold, you should specify gold bullion. In contrast to gold jewelry, the value of this gold bullion is purely in terms of its weight. You must also prepare a place to store the gold that has been purchased. For your own storage, you can save your own or rent a deposit box at the bank.
In addition to buying at the store, you can also invest in gold through the program. Here you don't have to buy gold bars with a minimum weight of 0.5 grams or spend several hundred thousand rupiahs to start investing in gold. If you have limited funds, you can even buy gold for only Rp. 100.
Property investment has some similarities to gold investment. There is a physical object that you buy here. Its value is confirmed to continue to increase without much fluctuation. In addition, the risk is low.
There are many modes of property investment that are commonly used. The simplest way is to buy land, build a property on it and sell it when the price is deemed high enough. And for the 2nd step, you can rent the property to get an income channel.
Do not forget to weigh risks such as damage to buildings. Although the risk of this investment is low, the property is an asset that can be destroyed by time. You have to take care of it so that its value is always protected. The maintenance costs that have been issued will need to be taken into account when selling the property.
Property investment is included as a long-term investment. So to get a return, you really have to suppress it for a fairly long time.
Prospective but high risk, such a possibility is a short description of stock investment. Stocks are actually proof of ownership of a company. When you buy stock, you are essentially buying some ownership of the company that issued it. So the more shares you buy, the greater the percentage of company ownership you get.
Stock investment returns generally come from dividends and the development of the stock value. Dividends are taken from the return earned by the company. However, it should be noted that not all companies distribute dividends to their investors. Some companies even choose to use the returns obtained to increase their business.
When compared to the 3 types of initial investment, the risk of investing in stocks is among the highest. It requires sufficient knowledge and analysis before choosing to buy shares of a company. But as an alternative, currently, there are stock mutual funds that have a lower risk but have the potential to return close to stock investments.
Is it a mutual fund? In simple terms, a mutual fund is an investment instrument in which funds from several investors are pooled together to be subsequently invested in investment instruments in the capital market. There are 5 types of mutual funds. The 5 types of mutual funds include money market mutual funds, routine income mutual funds, equity mutual funds, combination mutual funds, and index mutual funds.
Each type of mutual fund has different potential and risks. For the lowest risk, there are money market mutual funds. And for the greatest return strength with no less high risk, you can choose stock mutual funds.
This investment instrument is quite popular among investor groups, especially some novice investors who have limited funds. Mutual funds can be obtained starting from a nominal value of IDR 500,000 at HSBC. But if you want to buy mutual funds, make sure to understand your risk profile first. If you want to invest in mutual funds, you can evaluate and choose a mutual fund product that suits your needs, risk profile, options, and desired market. You just need to visit the nearest HSBC branch and meet our Relationship Manager to find out your risk limits and investment options.
Peer to Peer Lending
The type of peer-to-peer lending investment is still relatively new in Indonesia. Even so, his reputation continues to soar along with legal certainty and waivers that he sells. This can be seen from the number of financial technology lending companies that run this business model. The amount of money circulating in peer-to-peer lending investments continues to grow.
In peer-to-peer lending, in essence, you lend some money to the party in need, be it a person or a business entity. Similar to debt from banks, this type of investment return comes from debt interest that has been mutually agreed upon.
This peer-to-peer lending interest rate is quite attractive. Many financial technology lenders offer debt interest rates of up to 18% per year. Besides that, you can also start investing in peer-to-peer lending starting from only IDR 100,000.
Investment is the best way to protect wealth while increasing its number. But while going to invest, you must determine the direction of the investment and understand your risk profile. From the 2 information, you can choose the period and the type of investment that should be decided.