Investment growth refers to the increase in the value of an investment over time. This growth can occur through various means, such as capital appreciation, where the price of an asset rises, or through income generation, like dividends from stocks or interest from bonds. The longer an investment is held, the more potential it has to grow, thanks to the power of compound interest, which allows earnings to generate additional earnings.
Different types of investments can contribute to growth, including stocks, bonds, and real estate. Each type carries its own level of risk and potential return. Investors often diversify their portfolios to balance risk and enhance the chances of achieving steady investment growth over time.