An investment vehicle is a product that investors utilize to make money. Certificates of deposit (CDs) and bonds are low-risk investments; stocks, options, and futures, on the other hand, entail a higher level of risk. Annuities, collectibles such as art or coins, mutual funds, and exchange-traded funds are examples of other investment vehicles (ETFs).
Any mechanism through which people or corporations may invest and, ideally, increase their money is referred to as an investment vehicle. There are several investment vehicles available, and many investors opt to include at least a few in their portfolios. Diversifying a portfolio with diverse types of investments reduces risk by diversifying the assets in the portfolio. Diversifying a portfolio with multiple types of assets would, on average, provide greater long-term returns.