FOREX
An over the counter (OTC) market where buyers and sellers exchange foreign currencies.

Advantages of FOREX.
-High Liquidity.
-Leverage. (a small margin deposit can control a much larger total contract value)
-Round the clock trading access (24hrs market).
-Globality and Ubiquity. You can trade from any part of the world where there is internet access)
-Profit potential in both rising and falling market.

Disadvantages of FOREX
-It is highly volatile.
-Currency exchange rates are influenced by a variety of factors which can fluctuate over time.
-The high leverage comes with high risks leading to margin calls.

REITs
An investment vehicle that provides investors with a tradable interest in a pool of real estate related assets.

Advantages of REITs.
-Gives higher dividends than common stocks.
-The performance of a REIT follows the real estate market.

Disadvantages of REITs.
-Dividends are taxed at the same rate as income.
-Mortgage REITs tend to do poorly as interest rates rises.

Investment Profile.
Includes what you need in terms of duration, liquidity, returns and risk.

Returns.
-It measures the degree of price change over a given period of time.

Risks.
The chance that an investment’s actual return will be different than expected.

Attitudes to risk.
-Risk Seeking.
-Risk Neutral.
- Risk averse.

Risk seeking: A person who is willing to take on additional risk for an investment that has relatively low expectation.

Risk averse: A person that tends to increase risk only if they are warranted by the potential return.

Risk Neutral: A person that is only concerned with the investments’ expected return.

Portfolio
A portfolio is a combination of different investments assets mixed and matched for the purpose of achieving the investor’s goals.

Why portfolio?
Different securities perform differently at various times, so with a mix of asset types, the entire portfolio does not suffer.

In each asset class there are several products:

How the four asset classes have different levels of risk and returns.

The chart shows that short term deposits are the least risky, but give the lowest return over time. Whereas shares are the most risky, but in long term should give higher returns.