Investments For Beginners
You may be familiar with the stock market either from other peoples experience, by hearing your friend and relatives talk about them and invest in them or like most of the public seen and heard about in movies such as the notoriously well written Oscar nominated film The Wolf Of Wall Street.
Having a proper knowledge in the stock market and investing wisely could literally earn you large amounts of money over time when you can easily double or triple the original investment you started with, sounds pretty interesting, right?
In this review we are going to try and make the subject a little clearer to beginner investors and perhaps some intermediate traders on how to choose a stock and invest in the best choice possible so as to make the most of your time and money. Our advice may even change your life overnight so let's begin without further adieu.
Investment 101 - Investing basics: Introduction to the stock market
An explanation of what stocks are
Stocks (also referred to as preference shares by the British). In simple terms it means that a stock is a share of the ownership in the company. As the owner of a stock or being a stockholder, you have a claim on the company's earnings.
Instead of taking loans from the bank companies, there are some businesses that prefer to invest a bit of capital(cash) into the company themselves and give the rest out to investors, so that they can buy shares and have equity ( equity: the value of shares issued by the company).
The company gives out certificates to investors who buy a percentage of the company (the assets, the buildings, earnings, profits etc). You could also sell your own personal stocks to other investors for a profit yourself.
Stocks of numerous firms are bought and sold on a daily basis so being smart and decisive is the main thing that comes into play here.
For now and the purpose of simplicity there are two types of stocks that you need to have knowledge about:
Common stocks- these are the kind of stock that most people refer to during discourses and general banter on this topic. Common stocks or shares, give the stockholders the claims to the profits made and the voting rights within the company.
Being a shareholder you will often get one or more votes to elect members of the board for taking care of important decisions of the company, as well as voting for a new CEO or CTO.
Common stocks tend to bring the investors high returns but if the company goes bankrupt there are risks as you could lose all the money you invested (which is why you need to learn how to invest wisely), also you shall not be paid until the creditors and bondholders get their deserved capital.
Preferred Stock- preferred stocks give the investor the right to a fixed share or a portion in the company, the payment of which is prioritized over common stock dividends but on the other hands they do not possess any voting rights within the board of the company.
In the case of the company going bankrupt or getting liquidated the preferred shareholders will be paid before the common shareholder (as you are prioritized with this sort of stock). Also, the company has the choice or ability to re-purchase the stocks from the investor at any given moment of time without needing a valid reason to do so.
One more thing to note is that the investors have the power to convert their preferred stock to common stock if they wish to do so.
The significance of taking an interactive online course
You can self learn the basics of investment and start trading on the stock market and learn how to invest online. That being said, it is highly ineffective and can lead to high losses to your portfolio.
Various companies offer their shares online and after reading as well as understanding the information above you may take a leap of faith and end up buying some stocks but the truth is one should not rush into investing in a stock by making a hasty decision based on what others have to say when dealing with investments.
There are more things for you to learn and figures to get into your head well before you even invest a single Dollar especially when it’s your hard earned cash at risk. You simply cannot be ready to start trading in stocks, bonds or options for that matter so quickly.
This is why it is essential you to start by taking an interactive online course with great studying materials and tutorials to assist you in thoroughly understanding the stock market basics and learning how to trade safely and profitably.
The interactive tutorials trigger your visual memory which is much more powerful than your verbal memory and allows you to learn things with ease. The best thing about online finance courses is that most of these are free.
Besides the learning process is very convenient and flexible for you because you can study anytime and at any place (literally any place as long as you have a computer of course).
Therefore you have no excuses to not try out the online courses.
Visit Global Finance School where you will be able to find many financial interactive courses online where you will be able to revise, renew your personal knowledge or, start learning the fundamentals of the stock market and start building your investments profitably.
Take a look at this excellent course: The Fundamentals Of The Stock Exchange
Course Syllabus and Overview
· Course Syllabus and Overview
- Principals and Interest
- What’s Interest Payments
- Tricks For Calculating The Amount Of Interest
- Theory Of Finance
- The Consumer Price Index
- How Money Grows With Time
- Basic Concepts
- How To Calculate Average
- Daily Examples
- Basket Of Shares
- Calculating Price Basket Of Shares
- And a great deal more for you to see in this Investment for beginners online course.