Investment is putting resources to work with the expectation of a future return. It can be money in stocks, bonds, or real estate. It can also be a business buying new machines or a government building a bridge. The common thread is sacrificing something now for something more later.

In economics, investment means spending on capital goods, not financial assets. Buying a stock is a financial investment. Building a factory is economic investment. The distinction matters because only the latter adds to the economy's productive capacity.

Investment carries risk. The return is not guaranteed. Markets fall. Projects fail. Businesses go bankrupt. Investors demand higher returns for higher risk. Diversification and time horizon are the main tools for managing it. There is no free lunch.

Types of investment

• Stocks and bonds
• Real estate
• Business capital spending
• Education and training
• Infrastructure