Financial instruments of investment

Abstract

Introduction. One of the conditions of successful functioning, scaling and any enterprise developing is the availability of financial resources in an amount that responds to current and strategic needs. Their rational use, multiplication, and determination of the directions of investing can significantly affect the efficiency of the present activity and the future of the business as a whole. For an enterprise is important to search for ways to raise capital, ensure efficient use and invest in the most economically based and profitable projects in terms of payback position during the invest activities. The purpose of the paper is to analyze ways and compare methods of investing through financial instruments to find the best one. Results. The article systematizes the basic ways and types of investing through financial instruments. The practical aspects of return on invested financial capital and the conditions of its formation are investigated. The return on the invested capital of different ways of investing is compared and the ways of its increase are grounded. Deposits rates, inflation rate, and level of bonds' returns of Ukraine’s domestic government loans over the last twelve years are analyzed. The main US brokerage agencies are compared, and the best one is determined. The US stock market is analyzed. The advantages and disadvantages of financial investment instruments are identified. Conclusion. On the whole, having analyzed the deposit market, the Ukrainian government bonds, and the US stock market, we can conclude on the instruments of investing. The most popular option among Ukrainians is to use deposits. This financial instrument lets us save costs. The timing of the investment may vary depending on the needs. In comparison with deposits, T-bills are a more complex tool that requires additional knowledge and skills. This type of investing is used by investors to obtain short-term benefits and speculation. From 2018 to 2019, the annual average rate of return is 17%. Investment term up to 5 years. The last way to make a profit is to buy shares in the US stock market. With a long-term investment, this method of investing allows us to get 8% per annum with inflation-adjusted. Compared to deposits and T-bills, one can expect significant capital gains. The main disadvantages of this method are the human factor, so the large volume of funds should be accredited by institutional investors. In this article, investing in the US stock market is the best way to earn a return on investment.