Is the main source of money from wealthy people through profits from their own inventions/services that they own?

"Investing" covers an incredibly broad spectrum of possibilities. In general the more risk you can afford to take on, the higher the return you can expect.

Being not terribly wealthy I can't really afford to take a major loss, so I park my money in a diverse global index of mostly big proven companies and wait for general economic growth to provide a return. It's slow but it's about the closest thing to "sure" you can get while still calling it investing.

If I were a billionaire maybe I'd instead be investing in startup companies - sure 90% of them fail completely into an expensive total loss, but the 1 in 10 that pays off eventually will cover all the losses... so long as I can afford to wait it out until that happens (and tolerate the possibility that I won't "pick a winner" anywhere in the first 10 I try, but will instead hopefully find 5 winners at some point in the first 50). And if I have enough business acumen to do better than random chance at identifying which small firms are both promising and undervalued, then that only increases my potential gains.

That, or there's huge pay packets and bonuses to be earned by working as a high-level executive of a large corporation. Even if you turn out to be a bad fit for that company, you might get paid extravagantly just to leave.

/r/NoStupidQuestions Thread