Major Reasons in Investing in Stocks
In essence, stock is the share of possession of a general company. When you purchase stocks, you became a co-owner of the company you purchased. Stocks are being traded in a stock exchange or stock market wherein there you will buy and sell stocks. You should have a stock broker prior you can buy or sell stocks in a stock market. There you will enroll a stock trading account so you can buy or sell stocks directly.
I encountered the word “stock” few years ago when I was working in a company in the Philippines. It was provided to me by the company because it is one of the privileges of all the employees. The number of stocks given depends on the job function. That stock aid is without a doubt a big help for me and my loved ones in terms of our financial needs in that time.
Investing in stock is a good investment you can ever make if you only learn when and how to buy stocks. You must have also knowledge, discipline and diligence in controlling your investment in order to have an excellent earnings from stocks. Remember that you may only lose money in stocks in two actions: when you buy and sell it.
Moreover, one nice thing about investing in shares is that you can a greater earnings in the long term than other investment methods available today. Long term investing in stocks is you will buy shares systematically to a hand-picked stocks greater than 5 years.
In the Philippines, blue chips are those stocks comprised in PSE Composite Index (PSEi). According on the facts from PSE and BSP, the stocks put in blue chips will earn you a 14% average annual total return acording on the previous performance of Philippine stock market from January 1989 to August 2009.
In addition, for the last 20 years, investing in stocks earns you higher average annual total profit than Treasury bills (T-Bills) and savings account with 11.0% and 2.3% average annual total profit, respectively.
Thus, investing in stocks, particularly blue chip stocks, is the best way in order to gain higher return in stocks.
Gily Tenorio loves blogging on finance, saving and investment. He likes playing guitar and gardening. He lives in Korea with his family. For more details on how to invest in Philippine Stock, feel free to visit Financial Management, for free financial management articles on saving, investing and earn money online.
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