WHAT SHOULD I INVEST IN TO SEE A PROFIT?

I would suggest trying corporate bonds. They typically return around 7% annually guarenteed (usually Prime – 1 or 1.5). These returns are often better than most people will see in the market, but come at higher rates than T-Notes. Even though corporate bonds are subject to cap. gains tax (15% of interest earned), so are stock gains & dividends, so there’s no real loss.

Municipal bonds would be better because they are not subject to cap. gains tax, but ones with good ratings (AAA or AA) usually only come in increments of $5k, whereas corporate bonds are not too hard to find in $1k increments if you look outside the Fortune 500. Also, mid-cap public companies (companies worth more than $500 million, but less than $2 billion in USD) may have lower ratings and be more difficult to pin down, but offer higher interest rates (sometimes Prime – .5) and options for re-investiment of interest rather than semi-annual disbersements of interest accrued, which earns you more money and delays payment of capital gains taxes until the loan term has ended — which might translate into not having to pay ANY cap gains tax because there is a significant chance that Congress will eliminate the tax completely by then, meaning that after a typical 5-yr term, you could potentially earn more than $350 tax-free (about $70/year/$1k) in profit.

This is the secure route. If you really want to take some chance, though, for larger pay-offs, you could invest in Exchange Traded Funds (ETFs) which provide more diversity than any mutual fund with no fees (well, except those charged by your broker to execute the trade). Here, I would suggest the Chicago Mercantile Exchange ETF (NYSE: CME). This market has seen the most growth lately — 900% profit over the last 3.5 years (about 260% per year), but may be over invested now. Other than that in the markets, consider iShares, SPIDRs, and (my favorite other than true ETFs) the companies behind the larger stock exchanges. For instance, NYSE Group, Inc. (NYSE:NYX) has earned 40% profit over the last year. But if you’re looking for real growth — more than government bonds (about 5% annual profit) — I would suggest staying away from Blue Chips (PepsiCo, Home Depot, Proctor & Gamble, etc.)

Now, if you really like risk and want to really swing for the fences (and you can afford to lose your innitial investment) you can try emerging markets — very, very risky — or smaller public companies. The Small Caps are the ones that you’ll usually find on the biggest gainers / losers lists. It would not be uncommon to see one of these speculative stocks (speks) to go up or down more than 20% in a single day. These are the stocks that cause ulcers, though, and do not come recommended unless you happen to be a day trader.

So, overall, if you want definate security, look around at the bonds, but if you want high profit potential with lower risk, try ETFs, because they will usually perform better than and be cheaper than mutual finds.

if you want to invest only $1000 than dont think about corporate bond, only T-bonds ,because corporate selling in 10 and more denominations, sometimes five. And if you purchase T-bond for instance with 5 year maturity it will be hard to sell(in case interest rate will fall) it `cos you only bought 1 bond.