1. 2. Analyze suffixes of different parts of speech, translate the following words:

1. to invest – investing – investment – investor

2. to measure – measuring – measurement – measurable

3. to commit – committing – commitment

4. involve – involving – involvement

5. to analyze – analysis – analyst – analytic

6. to distribute – distribution – distributive – distributor

7. to risk – riskiness – risky

8. to return – returning – returnable

9. to specify – specification – specific

48. 3. Read and translate the text.

Broadly speaking, investing means committing capital with the expectation of making a profit. Active investing means that the investor makes the decisions on how his or her money is invested, as in starting a business or buying real estate. Passive investing means that the investor commits funds, but someone else decides on the specific use of them. Investing in a mutual fund is a form of passive investing.

Investment Criteria:

The first step in an investment program is to analyze the specific situation of individual investor or organization. An analysis must be made of the situation terms of income desired, cash requirements, and approximate level of risk.

The second step is to select general investment vehicles that best fit the specific needs of the investor. For example, investors should decide how much, if any, of their assets should be committed to real estate, stocks, bonds, commodities (for example, silver or gold), bank accounts, and other investment choices.

The third step is to select specific investments within the general areas. For example, should the investor choose corporate bonds or tax-free municipal bonds? There arc five criteria to use when selecting an investment vehicle: (1) investment risk, (2) yield, (3) duration, (4) liquidity, and (5) tax consequences.

Investment risk is the chance that an investment and all of its accumulated yields will be worth less at some future time than when the investment is made.

Total yield is the increase in the value of an investment over time, usually a year. Tax consequences refer to changes in the after-tax yield.

Duration is the length of time assets are committed. Investment decisions differ depending on whether one wants to make a large return in a few years or invest over the long term for retirement.

Liquidity is how quickly one can get back invested funds when desired. It takes time to sell assets such as a farm or business. On the other hand, stocks, bonds, and most commodities can be sold almost immediately and are thus con­sidered more "liquid."

An investor must weigh risk, yield, duration, liquidity, and tax consequences when he or she chooses an investment vehicle. It is wise to choose several invest­ments.

1. 4. Answer the questions:

1. What does investing mean?

2. What kinds of investing do you know?

3. What are the main steps in an investing program?

4. Do all investments involve any risk?

5. What are main criteria in selecting an investment vehicle?

6. Which of investments are considered more liquid?

50. 5. Give the definitions to the following statements using the text:

1. The increase in the value of an investment over time, usually a year.

2. Committing capital with the expectation of making a profit?

3. How quickly one can get back invested funds when they are desired.

4. The chance that an investment and all its accumulated yields will be worth less at some future time than when it is made.