What is a stock?
A stock is the goods or merchandise kept on the premises of a business or warehouse and available for sale or distribution.
How do i make money on stocks?
When you buy a share of stock you are buying a piece of a company.
They are two ways you make money, it’s easy to understand that your wealth is built in two distinct ways:
They are two ways you make money, it’s easy to understand that your wealth is built in two distinct ways:
- An increase in share price. Over the long-term, this is the result of the market valuing the increased profits as a result of expansion in the business or share repurchases, which make each share represent greater ownership in the business as a percentage of total equity. In other words, if a business with a $10 stock price grew 20% for 10 years through a combination of expansion and share repurchases, it should be nearly $620 per share within a decade as a result.
- Dividends. When earnings are paid out to you, these funds are now your property in that you can either use them to buy more stock or spend them on anything else.
THings to remember
Take some risks!
What kinds of stocks are there?
Ownership investments - Stocks are an example of an ownership investments.
Lending investments
Cash equivalents - These are any investments that can quickly and without great cost be converted into cash.
Lending investments
Cash equivalents - These are any investments that can quickly and without great cost be converted into cash.