Securities are a powerful financial instrument that may allow you to gain income without much effort. Of course, to achieve that you need to know how to invest money in stocks properly, which securities are likely to bring profit and when is the best timing. This means that you will have to study at least the characteristics of stock market trading.
How to invest in securities?
Technically, there is nothing complicated about it. The easiest way to conduct this this is through a broker. The broker will represent your interests on the stock exchange. He will title the shares in your name, and then sell, if that is your wish.
To get started, you need to:
• select a broker;
• provide information about yourself (passport details) and sign the contract (remotely, electronic signature);
• replenish the account.
When all the formalities are settled, you will have to select and purchase shares to form a portfolio.
How to make money on investments in stocks?
There are two ways to accomplish this:
Hold shares for a long period of time and receive dividends (if any);
Purchase securities cheap and sell high (that is, gamble on the rate).
The first method is not very profitable, but simple and less risky. The second promises more profit but requires more time and attention.
What stocks are better for investments?
Everything depends on your choice. Someone prefers ‘blue chips’ (Google or McDonald's), the other chooses securities of start-up companies with a great deal of potential in them (for example, shares of budding IT projects). ‘Blue chips’ are on the increase for a long time, they give stable dividends. Shares of young companies can both ‘be a bomb’ or sink speedily.
Perhaps the most vivid example is Facebook. Back in 2013, shares of the social network cost $ 25. In three years they have grown to 120 $. And this is not the limit: experts predict growth of 40%.
Is it possible to view securities as investments?
Undoubtedly. The main thing is not to think of the stocks as of an alternative to the contribution. The insurance for investing in securities against broker’s bankruptcy is not large, usually it does not exceed 100 000 euros.
Even if you invest in ‘blue chips’, you take risks. In the case of Ford or Morgan Stanly, this risk is minimal, but it is still there. Therefore, do not invest in securities the last thing you have. And, moreover, do not endeavor to sell real estate in elusive hope of fabulous wealth. As a rule, stocks are invested in out of ‘extra’ money, and thus the capital accumulates gradually.
Another difference between shares and contribution is personal participation. Having made a contribution to the bank, you can forget about it until the end of the term. But you need to monitor your stocks. Doing this is not necessary, but if you ‘keep your finger on the pulse,’ you reduce insecurities and increase your chances of a good profit.