There are two basic types of investments, lending and ownership.
When you choose a lending investment, you loan your money to an institution, a company, or an individual. In return for the use of your money, you’ll receive interest payments. And at the end of the agreed-upon loan period, you’ll also get your original investment returned. Lending investments includes everything from a savings account to Canada Savings Bonds, Guaranteed Investment Certificates, and corporate bonds. In contrast, an ownership investment means you become the actual owner — or part-owner — of your investment. Ownership investments — also called equity investments — include real estate, stocks and putting money into a small business. If the underlying business or property increases in value, the value or your share will also rise.