- Our clients' FAQs
- Reliable answers from stock market experts
- A real-life encyclopedia for a novice investor
What are stocks (securities) of large companies?
Today, stocks is a very convenient instrument for investing and obtaining additional income, as well as for investing temporarily free funds and forming an additional pension.
After completing a purchase our clients will assume ownership of their stocks. Stocks are registered with a securities custody, based on the agreements signed in accordance with the European Union legislation. Stocks that are owned can be transferred to any other custody directed by a client or promptly traded on a stock exchange.
If we mention about the origins of an investment culture, in the US and Europe - it spans over 200 years. Stocks are inherited, as well as securities & dividends.
All stocks are traded on the stock market and have their own market value
Access to trading is granted to companies, professional securities market participants, that are licensed by the financial regulator of the country. They provide their clients with a direct access to trading on a stock exchange.
There are two ways to make money on stocks – through market value growth and dividends. Market value goes up when it starts attracting investors buying stocks. The reasons may vary from quarterly data showing steady growth to an expected increase in sales, etc. Dividends are paid when the board of directors makes a decision to distribute part of the profit to shareholders.
How much can you make on stocks?
An important note to keep in mind is that returns on stocks are not guaranteed.
This is not a deposit, where a client knows in advance what amount will be in his account in a year. For example, at the beginning of 2017, the stock of Volkswagen AG (VOWG) was selling at €147.65, and on December 31, 2017 – it was valued at €178.50. During one year, you could have earned about 21% in €. A financial result depends on a successful selection of specific stocks. It is also estimated that if you had invested $100 in the S&P index at the end of the 1940s, you would have had $17,470 in your account by the end of 2013. However, if you would also be receiving dividends from companies included in the S&P index, reinvesting them, today you would have $265,851. What an impressive difference! Dividend is a very important component when investing in stocks!
In the US there are approximately 2,500 available liquid stocks that can be quickly bought and sold on the stock market.
The choice is ultimately yours and we are happy to help you!