The three major types of investments include ownership investments, lending investments and cash equivalents, according to Two Cents. Alternatives are a fourth asset class, and funds can fall into any of the investment categories.
Stocks are ownership investments because stockholders own part of a company, explains Two Cents. Real estate is ownership of a home, and running a business is another form of ownership. Bonds, CDs and TIPS are types of lending investments because they involve lending money at an interest rate. Cash investments, like money market accounts, are liquid and low-risk but offer little return, states Money-Zine. Alternative investments include commodities and precious metals. Mutual funds, index funds, exchange-traded funds and hedge funds can contain any type of asset.