Stock Investing – Invest your Money to Grow
If you are continuous reader on Techiewink then you just got an idea of Mutual funds and also know the very basic things which make investment easy in Mutual funds. There is Stock which we can’t ignore while talking about investment in market. The base for mutual funds is Stock. Actually, in mutual funds also we are buying stock indirectly. So the understanding the concept of Stock Investing is also an important activity.
Stocks are an investment which is equivalent to owning a share in the business that issued the stock. Mutual funds which are running by the team of experts will also accumulate the stocks from different companies. We can understand this concept with the help of below example.
Assume the below scenario:
- You own 10,000 shares of XYZ Corp stock, which is currently priced at 10 INR per share.
- There are a total of 1,500,000 XYZ Corp shares are still outstanding.
This means that your investment is worth 100,000 INR (10,000*10). And from the second statement above we can conclude that you own 0.67% of the company (10,000/1,500,000).
Stocks investing would be a key part of your personal finance strategy. This can be a long term or short term according to the strategy one will follow. But definitely it is used to earn returns on the investment.
The return which we talked about will come generally in 2 ways.
- Stock Price Appreciation
It means an increase, or an average annualized increase, in the stock price of the Shares of the business after purchase. If the price goes up more than the buying price over the time of duration then this means the stock is appreciated and your money is growing just because the company is doing well.
- Stocks Dividend
This is an optional distribution of profit from company. This is not mandatorily done by all the stocks but still many of the companies are doing dividend distribution. Mostly this will be done by company quarterly and will be paid out as cash or in the form of reinvestment in additional stock.
So we can conclude from the above statements that smart investors can enjoy the benefits of Price appreciation and high dividends at the same time from the Stock Investing. But do remember that there are sides of the same coin so where there is appreciation, there may be depreciation also so make your investment wisely.
You can check other investing related concepts here.
Another question comes in mind, where we can buy or sell the stocks easily. So the answer is there are many platforms available in the market where we can do this transaction and track/monitor the progress on the investment. We have already discussed a platform in the previous articles and the name is Groww, which is very convenient to use and most of the data is easily available for the companies which are there to invest.
This is the overview of the Stock Investing and now I am just closing this article at this point but still we have many points to discuss in this regards that we will cover in the next articles here.
