Think of owning even a small percentage of Apple or Microsoft which is the power of stocks. Stocks are ownership in a company and entitle you to benefit and share in company revenues and profits. Stocks, shares and equity are all terms that many people mistake to describe the same thing: being a part of a firm. The equity market has been one of the routes of wealth creation and it carries investors who are after growth, dividends and financial stability. Stock investing is more than its share and values – it is about creating the future of investing by trading smart.
Once companies begin to issue shares to raise capital to fund growth and expansion, or to continue operations, stock trading begins. By selling part of its possessor ship to the populace, companies are able to raise money and at the same time, it offers investors the opportunity to share in their prosperity. These shares are subsequently sold or purchased in stock exchanges like the NYSE or NASDAQ where the price fluctuates according to the demand, supply and market conditions. Modern stock trading platforms and stock brokers have enabled most of the stock trading activities today but this has made it even simpler to learn how to invest in stocks regardless of where you are located across the globe.
There are many varieties of stock investing that an investor can choose to invest in but each has its advantages and disadvantages.
Common stocks are shares that provide voting rights and capital gain to the stock holder whereas preferred stocks does not provide voting rights only fixed dividends, preferable to stockholders seeking a consistent income.
Growth investing is aimed at companies that seem poised to grow at a fast rate, whereas value investing is used to describe a practice in investing that involves buying the stocks of a low-priced company that appears undervalued relative to its value.
Blue-chip firms are large established businesses that are relatively safe investments and penny stocks are low-value stocks that are low aggressive investments and have a high potential.
Many people are interested in stocks that pay a dividend and offer long-term gains.
