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Old 23rd June 2011, 06:54 PM
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Default Ways to "Park Value"?



Money is a really vague concept. I always tend to understand money as a way to "park value". Similar to parking a car and later using it whenever we want, an easy way to park value would be in the form of fiat currency.

Here are a few "primary ways" we can park value in. For example, inflation can be understood as "de-valuation" of fiat currency relative to commodities like gold.

1) Very short term
- Fiat currency
2) Short term to long term.
- Equity
- Debt (Bonds/ Debentures)
- Commodities (Gold etc)
- Real estate
- Insurance
- Skills & Knowledge (via education)

There are many derivatives of the above which I have not included in the list such as say

Mutual funds - Derived from equity, bonds.
Money market instruments - Derived from bonds.
Foreign exchange - Derived from fiat currency.
ULIPS - Derived from equity, bonds, insurance.
Futures & Options - Derived from equity.
Mortgage-backed securities - Derived from bonds and real estate.
The derivatives list goes on.

However, if you know of any other primary ways to park value, you are welcome to post.
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Old 23rd June 2011, 10:48 PM
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You can add fixed deposits to your list of primary ways.

A bank account with an auto-sweep facility is a great way to maximize returns from spare cash.
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