Whether you want a common or preferred stock, we will provide you with the latest news, features, company backgrounds, data, and the analysis that you need to make an informed decision. We will always provide you with the best descriptions and opinions form leading investors to help you cut through the noise and get to the best stocks in the market at any given time.
Stocks are described as a way to create and build wealth. They are a form of investment that lets you own a share in the company that issued that stock. These investments make even ordinary investors own a part of the most successful companies in the world. On the other hand, stocks are a way of raising money for companies to fund growth, new products, and other initiatives.
When you buy a stock, you effectively gain ownership share in that company. You get a right to vote on the decisions that the company wants to make if you choose to exercise your right. However, most investors primarily own stock to earn returns on their investments.
These returns come when the stock’s price rises and the investor sells the stock at a profit — also, the investor benefits when the stock pays dividends. Dividends are payments made to shareholders out of the company’s revenue. In the long term, the average yearly stock market return is 10%, which falls to around 7% after adjusting for inflation.
It is always advisable to buy stock from different companies since the returns vary from one firm to the next. A well-rounded portfolio features stocks from many companies across various industries and geographies. Stocks work through companies selling shares in their business to raise money and then use the funds acquired for different initiatives.
Some companies use the money obtained to fund new product lines, invest in growth, pay off debts, or expand their operations. Once a company’s stock is on the market, it can be bought and sold among the investors. These firms start to issue shares in their stock through an initial public offering (IPO).
Whenever you decide to buy a stock, you mostly get it from another investor who wants to sell the stock. Also, when you want to sell a stock, you sell to another investor who wants to buy. Not all share is equal since some classes of stock may be issued without voting rights, while others come with enhanced voting right. Other classes come with a particular priority to get liquidation proceeds or profits before or after other types of shareholders.
You can buy stocks privately or publicly through stock exchanges. These transactions are heavily regulated by governments to protect investors, prevent fraud, and benefit the broader economy. Once you buy the stocks, they are deposited with the depositories in the electronic format called Demat account.
The exchanges track the demand and supply of every stock, enabling them to relate the price of every stock directly. You place all your stock trades through the broker that then deals with the exchange on your behalf.