Stocks – to be or not to be

Stocks 101

A STOCK is part of a company in the form of an entity that can be traded.

A person holding stock/s of a company essentially has a SHARE of that company

These stocks/shares are traded on a

Share Market / Stock Market

Investing in STOCK’s can

make money for you

Investing in STOCK’s can

make money for you

To trade in stocks; A person needs to be

registered with a Stock Broker

Why to invest in Stocks ?

• Assume you want to invest Rs 10,000• Current Annual Rate of Inflation : 8.5 % (approx.)

IF

Amount is kept in a Savings Account or FD(Fixed Deposit) for 1 year(Assuming an interest rate of 3.5 % to 7.5% {Approx.} )

Amount after 1 year (Adjusting for inflation) : Rs 9790.5 (Numbers given for representation purpose only)

Amount is smartly invested in Stocks for 1 year (Assuming a stock growth rate of 12% to 15 {% Approx.} )

Amount after 1 year (Adjusting for inflation) : Rs 10339.5 (Numbers given for representation purpose only)

Types of Stock Investing

Fund houses collect funds from people and collectively invest it. The MUTUAL FUND profits are divided among the pool of investors

Intra – day Trades

Risk Factor

Medium to Low

High to Medium

Low to Medium

SMART Investing

Warren Buffet is widely regarded as one of the greatest long term stock market investor

• Basic Study should be done before buy/selling stocks

• Advice should be taken from a Knowledgeable authority for taking an informed decision

• Systematic and Informed Decisions give decent returns

• Trading in Stocks on the basis of Hearsay & Rumors can lead to losses Short Term investment’s are risky and if not carefully done; can lead to huge losses

• This trading requires constant touch with the stock market and an in-depth analysis

Be Cautious !!!

Refrain from trading without proper understanding; as it can lead to losses

One should keep in mind that, stock markets involve risk and a planned approach to investing be taken

Only act till the extent that losses are bearable while performing

Dealing in shares in excess of one’s financial limits can be catastrophic

If stock are bought without examining it; the value of your investments can reduce dramatically

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