PB 601 INVESTMENT MANAGEMENT

Politeknik MalaysiaTeks dan Silibus

• CHAPTER 1• INTRODUCTION TO INVESTMENT– Introduction– Definition of Investment– The Differences between Investment Concept

and Speculations – Financial System’s Users

Introduction

• Investment: • The purchase of a financial assets with an

expectation of favorable future returns. In general terms, investment means the use of money in the hope of making more money in the future.

Figure1:Relationship between Financial Asset and Visible Asset

In general,investment may be referred to the ownerships of physical and financial assets.The physical assets may consist of investment and ownership of property (including buildings), machinery, technology and any forms of visible sources.Meanwhile, financial assets are comprised of shares, bonds, trade notes’ ownership and other ownership of financial assets.

Return or profit on the investment may consist of dividends, capital gains or interest (financial assets) and cost of an asset. In other words, investment is an activity for earning the future profits or increased in future value of money based on the current monetary value.

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