Investing online has become a matter of course in the 21st century at the latest. The main difference to the traditional “face to face” relationship with the bank is the lower cost of individual transactions.
In the meantime, there is even the possibility of designing the complete asset management online and online investing no longer needs to be mediated by banks, but is done directly and without detours on platforms created specifically for this purpose.
A closer look, however, reveals a wealth of differences between the individual investment forms, as the term “online investment” refers more to the technical way in which an investment is placed than to its object or the return opportunities and risks.
Invest online in the classic way
Admittedly: whether online banking at the local savings bank or the house bank can already be described as “investing online” would be an excellent point of contention.
The fact is, however, that almost every bank now offers the option of a digital bank account and does not just consider checking accounts. Investing online with your house bank is possible, for example, by buying and selling equity or bond funds or shares and foreign exchange.
In addition, fixed-term deposits can be invested and building savings contracts and life insurance policies or a private pension insurance can be concluded. Whether and to what extent this is worthwhile must be decided individually.
At least in the case of funds, the banks can charge an issue premium which, for example, the sought-after ETF (exchange traded funds) or exchange-traded funds usually do not need. There are even ETF savings plans for investing online and the option of debiting directly from a current account.
However, the products offered by banks and trading platforms are all of a classic nature. In concrete terms, this means that they are simply financial products that have been on the market for decades and that today suffer from persistently low interest rates.
One example is life insurance with a guarantee, where the guaranteed interest rate has only been allowed to be 0.9 percent for a few years. The influence of low interest rates can also be seen in fixed-term deposits or overnight deposits, where more than one percent is already a rarity. On the other hand, there is the inflation rate, which – depending on the month – is around one and a half to two percent, with which money is actually lost.
With shares it is in such a way that on-line to invest represents a proven method. If you know your way around and have a lot of staying power, you can look forward to solid profits, at least with reference to earlier figures. However, it is also the case that investing online entails the risk of a total loss.
The same also applies, by the way, when supposedly exotic types of investment such as precious metals (gold, silver, platinum) or commodities are chosen. Of course, online investing is also possible in the form of bonds to companies or government bonds and federal treasury bills.
Investing online with crowdfunding and crowdinvesting
A relatively new form of online investment is crowdfunding and crowdinvesting.
In some places, both terms are used synonymously or confused, whereby crowdfunding is an investment in a company or project that has not yet been founded, while crowd investing already requires a high degree of infrastructure. Both methods are interesting and also the suitability for online investing is given.
One of the central differences is the error of a mediating authority, which allows itself to pay for these services. Banks or other credit institutions are not needed for crowd investing and crowdfunding, because money flows from private individuals to private individuals or to prospective entrepreneurs, but also to established companies.
Without leaving his own four walls, an interested investor can put money into an idea that fascinates him or her and at the same time benefits from high returns. This form of investment is implemented via platforms created specifically for this purpose, but which usually incur no or only marginal costs.
Investing online, for example, can involve acquiring shares in a ship in the form of subordinated loans at high interest rates. These are paid out by the shipping company and always arise when the ship is carrying loads and has been chartered out for this purpose.
In view of a constantly growing world trade, the profit prospects are quite positive. The same can be said of investments in new projects of prospering start-ups or simply investing in clever business ideas.
A special form of crowdfunding is the granting of small and private loans. Here you lend money to a private person so that he or she can, for example, go on holiday or fulfil a wish.
It is not necessary that a business idea exists, but only the creditworthiness of the debtor is decisive. If this is a person with a verifiable regular income, this form of investment can also be worthwhile as the interest rates are fixed.
A win-win situation arises because the interest to be paid is usually lower than that paid by the banks and there is no need for such a comprehensive “paper war” and no such comprehensive audit.
Invest online in crypto currencies
A supposedly exotic way to invest online is to buy crypto currencies. Bitcoin and Co. is purely virtual money, which is now accepted worldwide and can also be used as a means of payment.
One of the main problems is the enormous fluctuations, which can bring very high profits but also losses.
Furthermore, discussions about the security of crypto currencies have been held again and again in the past. At least theoretically (and sometimes practically) these can be manipulated by resourceful hackers.
Investing online correctly
The question of how online investment works best and which concrete product has the greatest chances of success cannot be answered in general.
It is important that you are aware of your own willingness to take risks in advance and never “put all your eggs in one basket”. In other words, it requires risk diversification and, ideally, a clever investment strategy.
One should be careful with allegedly safe investments, since there are these with profit chances simply not and also Insidertipps and downloadable ?ways to the success? are only rarely recommendable in their overall view.
Instead, relying on common sense often works wonders. Finally also greed and impatience are not good councellors. Both can lead to a wrong estimate and to premature or wrong acting and thus to avoidable losses.