Asset Classes

Cash.  This is the most common type of investment.  You can invest in cash via a savings account.  Effectively, with a savings account, you are lending your money to the bank or building society, and, in return for this generosity, they pay you a rate of interest, sometimes fixed (usually called "bonds" although this is only a marketing term), and sometimes variable.  The bank then invest your money in turn.  Usually this is through mortgages and loans to other customers which provides the return needed to pay your interest. National Savings Certificates are also a type of cash investment.

Corporate Bonds/Government Bonds (Gilts).  This is actually an investment in a form of debt.  A company or government (Gilts for the UK government) sell a bond with a rate of interest usually with the original capital repayable at a set point in time.  You can invest in these bonds and receive the interest payment and maturity value.  The capital value varies over time as the bond is bought and sold on the stock market.

Shares or Equities.  This is a means of owning a part share in a company.  The value of the share varies as shares are bought and sold on the stock market.  Some shares pay an income known as  a dividend, although this can vary.  Most investors look for long term capital growth as well.  Investment is shares is for the longer term, i.e. typically ten years plus, and thus is usually suitable for long term investments.

Commercial Property.  It is possible to part own a large shopping centre or office, or completely own a smaller office or retail unit as an investment.  Investors can receive the lease payments as income and also look for long term capital growth.  Commercial Property is typically a long term holding as well. 

Funds. A fund is a way of holding the above asset classes collectively, so you spread your investment among many companies. See Diversification.

Capital values of shares, bonds and commercial property can go down as well as up, and can be volatile at times.  Interest rates can vary.  For most people, advice is essential.