Depositing money at banks or doing investment in the stock market?

Depositing money at banks or doing investment in the stock market?
Aug 23, 2007 02:24
ZOEY Points: Join Date: Nov 29, 2004 Status: offline	From August 22nd, the interest rates will rise again. The one-year deposit rate will increase to 3.6%, while the one-year lending rate will rise to 7.02%. It is the fourth time China has raised the imterest rates. In all, the deposit rate has rised 1.08% and the lending rate has increased 0.99%. How does it have its influence on people's lives? With the rise of the deposit rate, people can benefit more compared with the past. Meanwhile, the interest tax has also decreased. Choosing to deposit your money at banks can bring more profit. On the other hand, doing investment in the stock market is also a good way to make money. Compared wtih saving, it can bring you more money. However, you have to bear higher risks. At present, the share index has broken 5000-point mark. Obviously, the stock market has not been affected by the rise of the interest rates. Will it keep on rising? Judging from the current situation, either depositing money at banks or doing investment in the stock market can bring your profit. Which one will you choose?

Aug 23, 2007 02:24

ZOEY
Points:
Join Date: Nov 29, 2004
Status: offline

From August 22nd, the interest rates will rise again. The one-year deposit rate will increase to 3.6%, while the one-year lending rate will rise to 7.02%. It is the fourth time China has raised the imterest rates. In all, the deposit rate has rised 1.08% and the lending rate has increased 0.99%. How does it have its influence on people's lives?

With the rise of the deposit rate, people can benefit more compared with the past. Meanwhile, the interest tax has also decreased. Choosing to deposit your money at banks can bring more profit. On the other hand, doing investment in the stock market is also a good way to make money. Compared wtih saving, it can bring you more money. However, you have to bear higher risks. At present, the share index has broken 5000-point mark. Obviously, the stock market has not been affected by the rise of the interest rates. Will it keep on rising?

Judging from the current situation, either depositing money at banks or doing investment in the stock market can bring your profit. Which one will you choose?

Aug 23, 2007 04:32

APAULT
Points:
Join Date: Mar 11, 2006
Status: Offline

With an interest rate of 3.6% and an inflation rate over 3% the real rate of interest is little more than zero.

Of course there is risk in investing in shares ('stocks' in US English). I have invested in companies that were considered by many people to be sound and they have collapsed. Others have simply dropped in value for a long period. On the other hand I have made money where shares have increased in value and from the dividend payments. Overall I am ahead, but I am not rich.

The average investor should simply try to get a good return not get rich, though with what has happened on the Chinese market in the last two years it is a bit hard to see the wisdom in my comment. The Chinese economy is booming and as long as it continues to grow well, people can make money from share investments.

But the non specialist investor is probably best advised to invest in managed funds/unit trusts (same thing) from reputable investment companies, often part of banks or insurance companies. They will pool the money of many investors and but shares in many different companies. Then the good and the bad are averaged out. 90% of my money is invested in this way because I believe I cannot do as well as the professionals, but I invest 10% of my money myself, for fun, and just in case I am actually better at it than I thought (and it seems I am not!) so in effect I am gambling with this 10%.

My advice is shares are better than bak deposits, but invest through managed funds....and don't panic whewn ther is a downturn in the market. Maybe you won't get rich quick, but you are not likely to lose your savings in one go either.

Aug 23, 2007 21:43	#2
YVONNE Points: Join Date: Nov 29, 2004 Status: Offline	The stock market is changeable. Investing in shares is like gambling. Sometime you can earn much. Sometimes you lose all you have. No pain, no gains. For me, I do not have talent in investment. Thus, I choose to deposit money at banks though the return is lower than shares.

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