What Types Of Investments Have The Highest Returns?

When you first start investing in the stock market, you're making an excellent investment in your future. You're showing that you want to make your money work for you, rather than just work for your money. It's great and if you're like most people, you want to know what types of investments have the highest returns.

Realistically, the best answer I could give would be that a well-researched investment will almost always give a better return than a randomly picked choice. However, you're probably looking for actual categories of investments instead.

If you're looking to make more money than a typical certificate of deposit or bond, you might want to look at these high-yield investment categories.

If you're looking for low-risk investments that offer pretty decent returns, you might want to look into ETFs. Assuming that you are looking at ETFs that have historically performed well and are presented by reputable management groups, you could expect a return that matches or beats the market.

According to the ETFDB, the highest-yield ETF funds on the market can yield as much as a 100 percent return on investment this year, with many more easily topping 10 percent returns.

These types of investments have highest returns when they are managed by top teams—and they're relatively safe. Since they are basically fully diversified portfolios that are selected by experts, you don't have to worry about fund failure. You just have to make sure that you have a good team working the fund.

Apps like Motif and Stash offer them and help you learn how to manage them with ease.

Broadway Shows or Fine Art

If you have an eye for alternative investments and a lot of connections to the arts world, you might be able to wing one of these investments. According to insiders, this is a very high-risk route, but if you choose a winner, you can get several times you investment back.

The biggest drawbacks to investing in fine art or Broadway shows are that you can lose everything—and that there's very little that can tell you whether a work of art will be a hit or a miss. Additionally, investment minimums are often sky-high, with many minimum investments being as high as $25,000.

These types of investments have the highest returns out there, if you know what you're doing and know the right people. However, these are astronomically high in risk and shouldn't be attempted unless you have $12,000 to blow.

Though it also happens to be one of the most dangerous investments you can make, we'd be lying if we didn't say that cryptocurrency hasn't brought massive returns to investors. It makes sense, though. What types of investments have the highest returns, without a little risk involved?

The problem with investing in cryptocurrency is that it's shaky. There's no government or corporate backing with this investment, and it's extremely volatile. However, a lot of people have plunked down cash and made thousands this way.

Depending on what cryptocurrency you are talking about, you can easily get a 600 percent return on investment within a year. It's happened before, and it can happen again.

Of course, you can also lose everything. So, there's that issue to consider.

Angel Investing

Could you imagine how successful and rich the people who helped seed Google must be by now? These types of investments have the highest returns, but also tend to be the least likely to succeed.

CEOs of startups don't always have the money they need to succeed, and that's when they turn to angel investors. If you decide to invest in this route, you can expect to have a large portion of the company's equity and great payoffs—as long as the company succeeds.

If the company fails? Well, you're in the hole, too.

Commodities are another one of the most dangerous investments you can make, but like with cryptocurrency, these types of investments have the highest returns you can get. You can easily get returns as high as 200 percent in the short term, with long-term prospects often difficult to tell.

However, the problems with commodities trading are manifold. The market is insanely volatile and often will have factors at play that aren't anywhere near retail investors' scope of vision.

Even finding apps that offer news on commodities is difficult. (The one above was one of a handful on iTunes—a far cry from regular stock market tickers.) The majority of the tools that would allow you to invest in commodities safely are in the hands of major firms.

As a result, the chips are stacked against you and it's often just a bad idea to try with this one.

Mutual Funds and Index Funds

If you're looking for a more traditional, "tried and tested" route, look no further than mutual funds and index funds. Both of these kinds of funds are known for bringing high returns and remaining relatively constant as the market progresses.

Like ETFs, management is key here. The best mutual funds and the best S&P 500 index funds almost always beat the market. You can expect very good returns ranging from 12 percent per year to as much as 33 percent per year with top performers.

Assuming you get a well managed fund for your budget, this is one of the most easily accessible options on this list. These types of investments have the highest returns of all "traditional" investment categories.

What types of investments have the highest returns, but keep banks out? Well, with peer-to-peer lending, you become the bank. You get to write out loans, and just like a bank, get to reap the benefits of compounded interest rates paid by the borrower.

The amount you can get back ranges anywhere from 23 percent annual interest to as low as 2 percent. However, borrowers can default, which makes this a very high-risk endeavor. On average, people get around a 5 percent return per year.

That being said, some investors have returns as high as 15 percent. So, your mileage may vary.

Junk Bonds

Also known as "high yield bonds," these are bonds issued out by entities that are not considered to be safe bets by credit rating bureaus. These bonds can offer returns that are as high as stocks or even higher, depending on their rating.

Among bonds and other low-ish risk investments, these types of investments have the highest returns. However, since they are prone to defaults, it's very likely that you will lose a lot more than you gain.

If you take the risk, though, you might be able to do very well.