Investment is one of the major ways not only to create wealth but also to preserve wealth. Fortunately, we all want to be wealth and live a purpose and fulfill life which brings us to the investment portfolio.
Just like anything worthy while, investment is not a destination but rather a journey and not always a straight one, you understand, life. The journey of investment is mainly characterized by age the earlier you start the better, as you get to learn more gain experience, invest more and the anticipated end results is acquiring more wealth.
There are pretty of things that you can invest in at any stage of your life and situation. Today our handpicked venture of investing is stocks.
Yes Stocks, you might have an idea about this kind of investments and want to know more about it, this is your article and just like you I was also a beginner in this field. Well, am not bragging but I am doing quite well, so will you if you are consistent in learning and investment.
In this blog we are going to cover a brief introduction in what stocks are, why you should invest in stock, and which stocks you should invest on. So make sure to follow along and start your investment journey NOW.
What are stocks?
Stocks are securities that gives you ownership to shares of a particular company. Practically as a stock holder, you are a partial owner of a company.
Well, the companies need money to expand their growth or sustain their production. So the companies sell their shares to you which is termed as initial public offering.
So how do I earn with these shares I just bought?
Once you have acquired the share you automatically become a stockholder of that particular company and you can earn in a number of ways.
- One way is to hold the stocks and wait until they rise in value and resell your share in a stock market. The stock prices will always rise or fall because of the expectations the corporations earning or profits.
- The other way you can earn in stock is through your stocks dividends.
Why should I invest in stocks?
Investing in stocks comes with numerous benefits which include:
- Lower tax rates on long-term capital gains
- Income from dividends paid by the company.
- Capital gains from owning a stock that grows in value over time.
Some of the potential risk of investing in stocks include:
- The shares from a particular company may fall sometimes even to zero. So ensure to conducting a lot of research and due diligence before buying stocks of any company.
- Incase the company goes broke, you may be the last to be paid, with a risk of losing your money entirely.
- Your shares value will go up and down, therefor reflecting on your dividends.
Which stocks should I invest in?
Finally, the smoking gun, which are the stocks to invest in? when you talk of stock, there are local stocks and international stocks whose return varies, largely depending on the amount of investment you laid out.
Before investing in any stock, it is important to conduct your research otherwise you are gambling with you money. You don’t want to do that, trust me!
Look into the companies past performance and the stock history to help you determine if the investment is worthwhile. The background checks are very important.
Investing in stocks comes down to on thing HOW WELL DO YOU KNOW YOUR COMPANY? Can you a certain the profits and losses of you companies stocks in future, how does the company respond to calamities or political influence and other properties that might result to a negative impact on your investment.
