When it comes to passive income building or full-time day trading, investment will definitely pop up on someone’s list. Since the beginning of Wall Street’s history, the stock exchange has captivated people’s imagination of wealth and riches. But is it all that great?
Let’s delve deeper into the topic and see some of the basics of investment and whether you should join in.
Stock Market Investment
Why should one invest in stocks? It is a question asked by many first-time investors. In fact, some people actually consider the stock market as a dirty word! Before we go any further, let’s clarify that there are no guarantees that investing in the stock market will give you profitable returns.
The only thing that can be guaranteed is that your money will be at risk of being lost if not invested properly. If the thought of losing money scares you away from stocks, then you might want to consider other investment types such as real estate or commodities.
So why should one invest in stocks?
Now going back to the question of why should one invest in stocks, what does it mean to invest in stocks? When an individual makes a conscious choice of buying shares (which represent partial ownership of a company), then that individual has decided to invest in stocks.
These shares are bought from the stock market, which is where all the shares of various companies are traded. The price at which these shares are being traded is essentially what determines whether an investor will make money or not after purchasing those shares.
One reason is that there’s an increasing number of millionaires (and billionaires, for that matter ) who acquired their wealth through successful investing in stocks. This high demand for stock trading by investors has given rise to certain occupations such as financial analysts, brokers and traders who earn their living by helping individuals trade in stocks.
On another note, one can increase the odds of profiting through full-time day trading, by learning and exploring the ins and outs of stock markets. Day trading is filled with risks and uncertainties with a majority of day-traders losing money. However adapting the right strategies as a professional and well-informed trader, the profits can be pretty hefty.
Check out this infographic for tips on investing in a stock.
Final Remarks on Investment
The golden rule for all stock market enthusiasts who delve neck-deep into investing is to only invest as much as you’re willing to lose. Assuming that you have a stable job and money aside, investment in the long term is the golden rule anyone would agree on.
Investment is about patience and persistence through the ups and downs of the market. Wealth comes to those who distribute their investment portfolio into different stocks over a long period.
