Investing in the Stock market is the share, which means you are a shareholder if you even buy one share of a company for a long time period.
So, you really are becoming a company owner as a portfolio shareholder. And what affects business people? Okay, you know it: maximizing revenue and cutting costs. This is equivalent to increasing profit and making money. The price of stock then generally depends on a combination of the existing profits and expected future profits of that company.
If business is good, and companies make lots of money, stock prices usually increase. The opposite is true, too; when companies are doing badly, their stock prices are falling.
Companies with stable earnings and generating more cash than is required to fund additional growth opportunities pay out part of their reserves as “dividends” every three months. This is a direct cash outlay per share held. Companies will in fact send you mail checks to own their stock. And, if you choose, even larger firms will take the cash dividend that they would normally pay you to give you more company shares. That way, when the dividend is paid, the 100 RIL stock shares will grow over time based on the amount of the cash pay-out and the stock price. You’re going to end up with fractional shares and yes.
Stocks have proved to be a very valuable investment over a long period of time due to their very good returns. In the last 30 years, stocks have increased by an average of around 6% per year. Dividends add an additional 1.5 percent per year, so stocks are value-added overall.
|Stocks Rise in Value||Stock Dividends||Total Stock Return|
|6 Percent||1.5 Percent||7.5 Percent|
It’s a good return now you can go on the next step how to Buy & Sell shares of company stock.