Investment contracts are those kinds of contracts which are made when one party invests or puts its money into something with the expectation of a profit. Investment is basically equivalent to saving money and deferring it to be spent. Any investment has a security of principle as well as security of return which happens within a specific period of time.
There are various different kinds of investment contracts. The following are few types of such contracts:
- Guaranteed investment contracts
- Housing investment contracts
- Secured investment contracts
Any investment contract must be framed keeping in mind the legal nature and the formal style of drafting. Such contracts are usually drafted by experts. The following few points will explain briefly the points will should be kept in mind while framing an investment contract:
- The opening recital of the investment contract must consist of the date on which the agreement is entered into.
- In this recital, the names and address of the involved parties must be written too. If possible, the business names must be entered.
- The main body of the contract consists of the certain terms and conditions of the contract which are to be abided by the involved parties.