INVESTMENT IN ASSETS

Investors are often spoilt of choice when it comes to investment assets. There are three major classes of assets that can be considered towards this end; stocks or equities. Bonds, and real estate. Essentially, stocks or equities allow an investor to own part of a company. As such, they allow an investor the right to have a claim in the company’s assets and earnings. Investors earn from stocks through dividends or through the sale of the shares at a profit. Such buying and selling of stocks often occurs in a stock market where demand and supply is balanced through a variety of mechanisms. Bonds are issued by the government or corporations. Investors buy them with a clear understanding of the returns to be derived from them. they are thus viewed as low risk investments since the time of maturity and returns are known at the time of investment. Real estate excites investors who are keen on land, and buildings, especially houses. Investors interested in real estate buy land to develop it (mostly through houses) and sell such assets at a relatively high prices. 

Diversification of asset investments is typically the allocation of portfolio. An investor can allocate, for instance, 50% of their investment to the stock market, 20% to bonds, and 30% to real estate. The concept of diversification is premised on the concept of risk distribution. Some assets are riskier than others. To mitigate such risks, an investor can opt to have their investment distributed across different asset classes. According to Islam (2011), during diversification, the assets need not be perfectly positively correlated. The ease of diversification is often determined by how informed an investor is. Further the ease of disposing a class of assets is critical to an investor who might consider diversifying to an asset. The requisite information and the ease of obtaining such information provides sufficient flexibility to an investor. As such, an investor is at ease while making decisions about diversifying. 

Futures and financial derivatives are not common investment assets. These assets are somewhat complicated and often require extensive economic and money market knowledge to partake. As such, they are a preserve of elites such as bankers. They include futures contract, financial derivatives and forex market options. They are basically financial instruments based on an underlying asset, for instance, precious metals or commodities like oil. Of late, cryptocurrencies are fighting to be recognized and are complicating issues further. 

NASDAQ Dubai is a famous and an international market. Stocks are the most widely traded group of asset in the market. Among the major stock markets in the Arabian world, it is the most international. The vigor and organization in the market has attracted stocks from different companies in different countries with strong financial markets. These countries are mostly in Middle East, Europe, Africa, and North America. NASDAQ Dubai makes trading in stocks in this country or any part of the world rather easy. To further make stock trading easy, the market has adopted online modules where investors have access to real time information that makes investor decisions rather easy and more pointed. Investors don’t have to wait for information from mainstream media and other sources. The result of this and many other innovations make stocks very popular in Dubai and the wider Middle East.

Stock Investors in Dubai have unique advantages as discussed by Nadaq Dubai (2018). The speed of conversion in the market is remarkable. This means that the time between expression of interest in selling to a time such an asset is bought is short. The market is thus described as highly efficient and accurate. The Dubai market as discussed by Aloui, Hammoudeh, and ben Hamida (2015) is sharia compliant, a remarkable feature in the Arab world. The market is highly presented. The element of superior presentation is critical in ensuring that information gets to investors at the right time in the right format. The market, due to its insistence on the use of online platforms, utilizes the most recent security features to ensure that security of stocks is assured. Stocks in the Dubai market are critically assessed to ensure that there is an adequate trail of releases to control distribution. Consequently, trading in stocks assures an investor of the advantage of order and organizations which is important in investment. 

In conclusion, investments in assets is a rather wide avenue since there are unique investments available to the taste of an investor. To minimize risks to the earning potential of an investor’s investments, the concept of diversification can always be explored. An investor in a liberal market is often allowed to invest in accordance to their wish. Individual factors, more so, information often act to limit the ability to invest. As such, experience and wit are often called in to action when considering diversification of assets. Investing in stocks in Nasaq Dubai is often interesting due to the organization and diversification possibilities in the market. The market has matured enough to allow investors the opportunity to invest with positive outlooks.

References

Aloui, C., Hammoudeh, S., & ben Hamida, H. (2015). Global factors driving structural changes in the co-movement between sharia stocks and sukuk in the Gulf Cooperation Council countries. The North American Journal of Economics and Finance, 31, 311-329.

Islam, A. H. M. M., & Faisal, M. (2011). Investment Diversification: A study on six European Countries. Umea School of Business. [Masters Thesis].

Nadaq Dubai. (2018). Our Technology. Retrieved from Nasdaq Dubai Website: http://www.nasdaqdubai.com/trading/our-technology