If you include investing your hard-earned money in your New Year's resolution this 2018, then it will not do you bad if you try investing in stocks. This article, as the title suggest talks about anything you need to know about stocks and the stock market.
The "Buy Low, Sell High" Expression
Have you ever heard or read of the “Buy low, Sell high” expression? If your answer is a big and resounding YES, then I guess you already have some experience strategizing, analyzing and monitoring your own account at the stock market. It also sounds that you are already on your way becoming a “wall street” whiz. If your answer is “NO” or “NEVER” on the other hand, then it seems that you might be an average Joe, trying and starting to learn how to take more control of your investments or you maybe someone who knows about investing but never learned, heard or read about the above-mentioned phrase.
Nevertheless, your answer doesn’t matter. The “Buy low, Sell High” phrase is just one factor that would determine you are in the stock market. You’ve got to buy shares when the economy is low and you’ve got to sell stocks when the economy is high. The phrase is also not just a cliché but a basic guide to succeed in the stock market.
My further explanation (as you continue reading) with regards to this investment is for everyone.
If you are already experienced, this should be a good primer of stock market education for you to explain to your friends who are interested to dive in stocks. If you are a beginner and/or you are someone who doesn’t have any background about stocks, this is a good starting point to increase your financial literacy as an aspiring investor. It will surely pay you off in the long run.
So without further ado, let me introduce to you the first investment vehicle- STOCKS AND THE STOCK MARKET.
What are Stocks?
This a type of an investment instrument that allows you to have partial ownership in a company through stocks. Stocks has two main types. One is Common Stock in which the shareholder has voting rights during meetings and receive dividends. This is also the type when people talk about equities. The other type is Preferred Stock which has the opposite feature from the Common Stock. Holders do not have any right to vote but they can claim higher and fixed earnings than those in the common stock.
How to Invest?
If you want to invest in the stock market, the Philippine Stock Exchange (PSE) is the perfect place that you need to consult with. But investing your money in the stock market is not as easy as joining a club where you need to sign papers and then that’s it.
First, you should open your own account in a Stock Brokerage Firm and there are 132 active stock brokerage firms in the Philippines. These firms are also registered under SEC so they are considered safe and legal. You also need to consult a licensed Stock Broker or Certified Securities Representative (CSR) who will process your order so that you can invest in one of the 272 listed stocks. Your only requirements to open an account are Valid ID, Billing statement and signature cards. For faster processing, you can already apply at home or at any computer shops through Online Stock Brokerage Firm.
Another reason why investing in the stock market is not easy as what others think is it requires you to have some knowledge in monitoring and buying your stocks. You need to study the so-called Fundamental and Technical Analysis of the market so you may know how the corporation earns as well as those running the business in its progress. Take a basic self-learning course about the stock market first before taking the plunge.
Investors who are into stocks
Stocks are one of the best types of investment but it’s not enough for you to just quickly invest your money in this vehicle. You need a guideline or a criteria so you will see if you are really into it. One is if you are willing to expose yourself at a greater risk. If you’re conservative in investing and you have low emotional quotient in terms of losing a greater percentage of your capital from the stock market, then don’t dwell into this. Please note again that ROI or Return Of Investment in the stock market is not guaranteed and would change from time-to-time. If you, however is willing to take risks, then there’s nothing wrong when you give stocks a try. That is because you also want higher returns, which makes it another guideline that you are bound for the stock market. When you don’t feel good about putting your money in a bank that gives only 0.25% interest per annum, then consider investing in stocks that can give you the opportunity to earn higher.
To Bite or Not to Bite?
As I close my discussion about the stock market, I can sense that there is a question running in your mind, which is to bite the investment opportunity or not to bite? And in all honesty, I couldn’t answer this question because I already have provided a criteria that will put you to test in the world of stocks. The answer will come from you. Make a thorough and deep assessment of yourself because your decision comes down to how much money are you willing to set aside for stocks and how will you be able to tolerate its risks.
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