Investment Accounts

In simple terms, an investment account is an account designed to keep track of the assets of clients (usually individuals). Investment accounts can be opened by a client in an investment or management company on the basis of a trust management agreement.

Common types of investment accounts

Why does the state need such an account? One can get the following answer: “It is necessary to provide companies with cheap money.” After all, it is no secret that the population keeps their savings in banks, and for business, this money costs as much as loans in these banks. And this is a lot. It is much cheaper to get this money directly bypassing the bank, so the government’s task is to attract a domestic investor.

Therefore, the presence of such a mechanism as investment accounts should shift the point of view of the population, when choosing instruments for saving, towards the stock market. That, in turn, will raise the demand for securities, and if there is demand, then there will be market growth.

Investment accounts: features

Let’s take a look at the common features of investment accounts:

How and where to invest using investment accounts

Investment instruments for an investment account are prescribed in an agreement with your brokerage company.

You will be able to invest in different assets with different levels of risk, for example:

How to open an investment account

If you want to open an investment account, then it is worth contacting large brokers that have a wide branch network or banks that have subdivisions engaged in asset management, they usually provide investment in mutual funds.

Most likely, there will be other companies that want to get their piece of this pie and also join the race to open an investment account, so there will be plenty to choose from.

As a rule, almost every company provides the opportunity to either trade independently on the stock market, or ready-made investment products or strategies with different levels of possible profitability and risk (these parameters may not be declared at all). But for the most part, finished products can be roughly divided into the following groups:

When opening an investment account, you should remember the following points:

Finally, let’s go over the main pros and cons of an investment account.

Pros of investment accounts

Cons of investment accounts

Final thoughts

An investment account is an interesting product that can be suitable for almost all segments of the population. It is clear that investment accounts with an income of less than 20% per annum will definitely lose to bank deposits. Therefore, investors need to offer a product with the highest possible income and with a minimum commission.

With a significant influx of private investors, market growth can occur and those who invested earlier will receive a higher income.

Of course, an investment account is a very progressive product, and investors have a large number of opportunities to earn money within the framework of investment accounts. Hopefully, an investment account will be able to create a whole class of competent US investors.