No single option can instantly make an individual a millionaire or a billionaire. This is the simple, yet harsh truth, that all of us need to accept. However, certain avenues of investment provide us with a genuine amount of security, a little extra cash and in some cases, genuine peace of mind. Our financial interests are secured by these investments. Investing Concept and Terminology Before you dig deep into the issue of finding the best possible investment destinations, you will need to be familiar with some key terms, that are often used in the industry of financial investment.

• In case of investments, Return on Investment (ROI) is one of the most important indicators, as to which investment vehicle is really good and which is not. The return on investment is calculated by subtracting the already invested amount, from the total returned amount. The product is then turned into a percentage, sometimes the element of time is also multiplied into the said percentage.
• Next off, you need to consider two parallel factors namely, for how much time is it necessary to undertake the installment payment, and secondly, also check the schedule for the installment payment.
• Thirdly, check the safety of the investment channel. Check the assured returns and lastly, check the amount that is going to be affected by potential portfolio performance and the performance of the economy.

As a rule of thumb, note that you should get back your total investment. Plus, you should get a return rate of at least 5-7%. Of course, returns that are over 7% are also great and welcome. Also note that there is a certain limitation over what rate of return you would get, hence do not expect a rate of 300% or anything like that, a rate over 10-15% is good enough. Some investments that are performing well may also pay 20% or more but this is not very common. Lastly, invest money, keeping your short term and long term liquidity requirements in mind. Best Investment Options for 2012 The following is an explanatory list of some of the popular and safe investments, which have decent yield. 1. Shares and Stock The stock market is one of the greatest place to store away all your free cash. There are two things that you need to do, if you want to make a substantial profit through the stock market. You need to purchase good promising stocks at a low market value and sell them, at a substantially higher price, to ensure that you get a good profit. Now when it comes to stock markets, there is a possibility of losing everything that you have invested, hence updating yourself about the stock markets on a daily basis helps a lot. Now any economy, along with all its stock and money markets goes through 4 primary phases, namely, a fall (also known as a bearish market), a rock bottom, a rise (known as a bullish market), and finally an apex. In such instances during the fall and the rock bottom, since the prices of stocks are dropping and are at an all time low, it is good to purchase securities at such a point. When things go into upward motion towards the apex, it is time to start selling. The best-selling point is of course the apex. Apart from common shares, there are a lot of other securities in the stock market such as bonds, debentures, asset backed securities and options, into which you can invest. In 2012, volatility is going to be the order of the day, in markets all over the world. Therefore, stock investment is going to be even more risky. Ergo, utmost discretion is advised, when investing in any kind of market based security, including stocks and bonds. Research thoroughly, before making any kind of investment. 2. Funds and Accounts Professionally managed funds and accounts are also an alternate option to shares and common stock. The advantage of any professionally managed fund is that the risk of losing money is eliminated to a great extent and a rate of return of about 5-7% is also ensured. Depending upon the portfolio and the general performance of the economy and markets (stock and money markets), the returns of the funds and accounts vary. Mutual funds and annuities, which are the most prominent funds have a guaranteed benefits/returns clause, that is, as per the clause you will get a return of about 5-7% or in some cases even more, along with the initial amount that you have invested. In addition to that, you will also have bonus benefits and returns. If the portfolio in which you have invested works out wonders, then the managing company shares some of the extra profits with you. The best thing about such funds and accounts is that the funds are invested in highly versatile channels and destinations, which include money markets, stock markets, offshore high yield accounts and funds, direct investments into some specified high performing companies, preferential and non-preferential stocks, basically anything and everything that provides excellent returns. Such funds and accounts include, Mutual Funds, Collective Investment Schemes (CIS), Systemic Investment Plans (SIP), Cash Back Investment Plans (CBIP), Unit Linked Investment Plans (ULIP) and annuities. However, remember that most mutual funds invest in stock markets all around the world and therefore, they too are going to be subject to much volatility in 2012. Thoroughly research the current and past performance of the fund and analyze the quality of its portfolio before going ahead. 3. Governmental Sources Now the safest of all options are the governmental sources. Government investments include bonds and certificates of federal Government, state governments, treasury bonds and bills. These instruments tend to have a return on investment and a small period of expiry. Individual Retirement Accounts (IRA) and 401(k) are some other options which are operated by the government. The merit of these accounts and schemes is that they tend to have an excellent rate of return of about 5-10%, not to mention the security and safety that it offers. In 2012, these government backed investment channels are the safest harbors for your money. 4. Life Insurance Some types of insurance policies such as health and auto insurance may be viewed to be an expenditure, however life insurance is something that ensures complete financial security for you and your family. Conventionally, a life insurance policy works in a manner similar to investment funds and accounts. The insurance policy does provide a return after every few years and also has a death benefit clause. So basically, it's a good investment not just for you but also for your family. 'Think' and 'Calculate' are two things you must do, when you take a look at any said investment. Fact is, almost all investment options are really great, you only need to find out the best one. Also, investing into a combination of channels always works, to your benefit, as you are not putting all your eggs in the same basket, which ensures a certain security for investment.