Whats the easiest way an investor can get high returns with low risk?
(Laughs) Pay off your credit card bill and all other consumer credit. This will give you returns above 16 per cent with no risk. Most people make the mistake of carefully working on their investments and trying hard to obtain high rates of return, while ignoring the high cost of their own loans. If your credit card company charges you 2 per cent per month, your best investment opportunity is to repay the outstanding; this gets you 2 per cent per month without risk. What should a retail investor do next? Don’t keep your money in the bank. But aren’t banks the best choice for risk-averse people? Even for people with a very limited appetite for risk, banks are inferior alternatives. Money in savings accounts earns 4 per cent. Longer-term deposits earn from 8 to 11 per cent. Instead of lending money to banks, investors should lend their money to companies. Corporate bonds, as of today, commonly earn returns above 13 per cent. This gain in returns is quite large, and default risk, where a b
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