What are Stocks?
- For investors, buying stocks of a corporation is a way of investing in companies that they believe will succeed in the future and will help make them profits
- For companies stocks are a way to raise money to fund growth, products and other segments within the corporation
Reasons to invest in Stocks
- The stock price appreciates, which means when the stock value tends to increase you can sell it to another investor in the market and make a profit.
- Stocks pay dividends, not all stocks do, but generally most stocks pay dividends, where payments from the company’s revenue are made to the shareholders.
Over the long term, the average annual stock market return is 10% the average tends to fall between 7 to 8 percent after adjusting to inflation
It is very essential to remember that there are two main methods of investing,
1. Fundamental
2. Technical
Fundamental analysis is a method of measuring and evaluating the intrinsic value (essential value of the asset) of the asset, and analyzing the factors that could influence the price in the future
Technical analysis is the forecasting or the prediction of future changes and movements in the stock value and price based on an examination and evaluation on the previous shifts in the stick value and price
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