Should the ordinary man invest in stocks?
Why invest in stocks?
The actions are invested to earn. Very simple. But you won’t earn from selling shares for a higher price than purchase price, you will earn from dividends that are paid several times a year, i.e. in the period when the company which dividend you possess decides that. Each company may decide to keep all the profit and reinvest in the growth and development of the company, or may decide to keep part for the reinvestment and another part for the division to shareholders.
In all over the world this is very normal and very desirable. People cultivate a culture of investment. Perhaps due to the fact that their systems are more orderly and people are more educated and better educated. People think that only large investors and brokers invest in stocks, but that is not true, ordinary people can invest too. It is payable to invest in stocks (see startborsa.com) and generate huge dividends rather than invest in savings. Why do you think Florida is full of pensioners.
How To Invest In Stocks For Beginners
Take, for example, only General Electric, one of the largest companies in the world. They paid about $0.23 per share quarterly. Thus, 4 times per year. Today, GE will cost about $23 per share. Let’s say your have some savings is $23,000 and you want to invest, you can buy 1,000 shares and dividend yield between $920 annually. If you put $23,000 on deposit in any bank in for a year you will earn $230 that is lower than to invest in stocks.
There is the huge difference between different parts of the world. In the USA you would have much higher incomes and a more normal life and you will be able to make even your personal investment portfolio. So in addition to GE bought shares of Apple say. They are currently paid about $0.50 per share quarterly. The whole history can be found here. A current value of stocks is about $103. So let’s say you have $23,000 of available, you can buy 223 shares. These actions will make quarterly $111.5 and $446 per year.
Abstract: For $46,000 savings per year you will generate income of about $1,366 and if you put $46,000 into a bank exercised to about $460 per year. Less for $906. But nowhere on and profit from the enormous growth of share prices and their possible later sale. Imagine, tomorrow Apple invent a flying car. Shares rise with $103 to $400. When you sell half of action that you had , say, 110 pieces, you would earn $32,760 (price 100 shares when they were purchased at a price of $103 price minus 110 shares at $400 when they are sold). And while you still have the action to continue to receive the dividend.