The investment in the stock is like being an owner of the company. You can trade in the equities in the market. You will get the share in the profits of the company as well as the price of your investment in stocks will also increase so that increasing your wealth if company is successful. Many of the multi-national companies are traded so that the people will get the chance to buy a piece of the shares from the market so that to own something of it, also the investors can buy some of the smaller companies stock which tend to grow in future. Here is the pros and cons of investing in stocks :
- High returns:
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The returns in the stock market are very much high compared to any other investment done. The need to gain high returns is to get a good portfolio. The stocks provide good returns over a longer period of time.
- Dual benefit:
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The benefit of dual returns is also a vital characteristics of the stocks, you will get the regular income from the company in the form of the dividends as declared by the company in the meeting and also you will have the increase in the stock value of your company and so that you can earn income in a long time.
- Easy diversification:
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There are many kind of the stocks available in the market, you can diversify your investment as per the risk bearing capacity and also your portfolio and also the diversification is needed to be done so that to earn more from many of the industries.
- Liquid in nature:
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The stock are very much liquid in nature, you can sell them any of the time in the market and get the money invested in the stocks. So it is the most liquid investment existing.
- Risk in short term:
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There is always risk factor in the short term investment in the stocks as there are frequent fluctuations in the price of the shares in the market and thus the investment shall be kept for the longer period of the time. The small news will also affect the price of the stocks so you cannot rely on any of the stock I the market.
- Improper portfolio:
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If your portfolio is not proper and the stocks in it are making the loses then it may happen that you lose the money invested in the stocks and also the portfolio is needed to be set up as per the needs and priorities of the investors so that they can buy the stocks in the particular industries.
- It takes time and analysis:
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The investment in stock can be done by the investor over a longer period of time and no one can learn it overnight so we can say that you need to go for the analysis with lot of the time and also with the courses available in the market to analyze the charts and the situations of the stocks in the market.
Thus Investment in Stock Market should not be done by just following investment agencies’ advices but it needs regular practice and to stay updated to market conditions in order to gain higher and stable profit.