Today’s angel is helping you get more information about investing in stocks and reminding you that you are solely responsible for the decisions you take in life and most especially focuses on investments. Is investing in stocks something you would want to honestly consider? Knowledge is power hence today’s angel wants you to equip yourself with investing skills and absorb as much information as possible.

It is an advantage for any modern man to stay in the light of what is going on around him. There are many untapped opportunities that you need to know about for you to have a secure future. Stocks which are also known as shares are something to delve into and it is with surety that after this guide by your angel you will start to consider whether to get yourself to owning them.

Stocks, a worthwhile investment.

Stocks also known as shares are the ownership of part of a company, where you are an owner of part of the assets and profits earned by the company. The percentage of ownership can be big or small depending on the investment done. You can invest in two types of shares which are ordinary shares or preferred shares. By investing in common shares, you are allowed certain privileges such as being allowed to vote decisions in the company, like the board of directors.

You are also entitled to receiving dividends after all payments are done to other divisions like creditors and preferred shares owners. However, as a common shareholder, you have a higher risk of not receiving dividends in case the company fails. 

On the other hand, as a preference shareholder, you are entitled to receiving dividends whether the company makes losses and you also have the advantage of priority in receiving dividends as compared to ordinary shareholders. Most people prefer to invest in common stock but your angel advises you that this is a personal decision you can make depending on the goal you have set to achieve.

Most companies put up their stock for sale so that they can raise capital since it is an easy way rather than borrowing which can leave a company in a huge financial crisis. Other companies have ideas that they want to develop such as service industries where they do not have assets to stand in for loans. The stock offering is a good alternative to get capital.

A company can advertise selling shares to the public, which now makes it a company owned majorly by the public. As a business person, if you do not want to dilute the ownership of your company, issuing stock for purchase may not be the ideal option for you and debt capital might be your best option. 

The prices of stock are guided by the number of buyers and sellers. If the buyers are many, the prices tend to get higher, and if the sellers are more the prices of stock become lower. The prices of selling stock are initiated by bidding in an auction. The buyer mentions the amount of money they are willing to invest in a share, these bids are given by different buyers and ultimately sell to the highest bidder.

This sets the price for the shares. The seller can also offer the lowest price of a share. Both ways of setting prices are determined by the number of buyers and sellers. This said you understand that it is not a complicated business and you can easily adjust to it if you decide to get involved in the stock market.

A pathway to owning shares.

You can own shares even without direct interaction with the company through stockbrokers who are people who act as middlemen between you and the company. On behalf of the company, they sell the shares to you. Once you are a shareholder you are entitled to receiving dividends which are directly affected by the assets and profits earned by the company.

Investing in stock is more of a long-term investment for you, where you can continually get your dividends as long as the company is in business and making a profit. You can choose to invest in a company that has been around longer and is more stable, that way your money will not be lost. You can take time to follow companies in your region and observe their performance and their records on business, for you to have informed decision making. 

Most companies will be listed on the stock exchange, where you will observe their performance. Stock exchange listing allows the company to find more buyers and also advertise the company. On the downside, stock listing gives a company pressure to reach higher profit margins to get clients which can lead them to make good but short-term decisions without looking at its long-term effects.

You will have to open a trading account to start purchasing shares, the account is opened at a fee and there are monthly fees incurred to keep the account active. You will also pay a fee to the broker for brokering the business to you. However, do not be overwhelmed because all these transactions can be done online, with an informed broker.

There is no great profit where there is no risk. You need to push yourself out of your safe space and get into investing.

The power is in your hands.

You want to go easy on the good news! Investing in stock is a risky business because of the changes in the prices of shares. However, if you do thorough and keen research and take time before investing in a company it is one of the ways to get yourself very good profits and build yourself wealth. If you decide to do this as a long-term investment, you have to know when to withdraw from a company and sell so that all your investment is not lost, depending on its continuous performance. 

Your angel wants you to take slow but steady steps in getting involved with this by buying small amounts at a time and observing how that works for you. Eventually, when your skills are sharpened on knowing how companies work, you can decide to invest in different good and stable companies. Financial freedom is a goal you should strive to achieve because it gives you the freedom to achieve your higher purpose. Let the light lead you.