Investments are money temporarily given to someone else in order to run a business with it. This someone else could be a bank or a corporation.
Every investor expects certain guarantees or abilities to get the money back. Investers further expect some mechanism to get back more than they where lending. This more depends on the length of time the money can not be used by the lender and by the risk that the money may never come back.
Risk is an important factor in investments. One expects to have the invested money returned in some form, but there is always a small risk that sometimes this will not happen. For example a company can hit really bad fortunes and is unable to return the money.
Such loss of money can be total or partial. Depending on the cause and some other factors.
Risk can be very high, and so should be the expected return on the investment. When risk is really high and can hardly be calculated based on past returns or other factors of the business, it is called speculation.
To mitigate risk one can and should diversify investments. That means one does not invest the entire savings into just venture, but in many different ventures. The hope is that not all ventures fail at the same time. Some might win, some might loose, but the overall valuation is growing.
There are many classes of investments, such as bank deposits, bonds, stocks, gold, precious metals, commodities, real estate, art, rare collectables, antiques, crypto currencies, NFT, etc. They all have different characteristics as an investment.
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