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Cashback On Finance And Shopping |
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APR Rates
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STOCKS AND SHARES A share in a business is a part ownership , if you own a full company you are probably the directory or sole proprietor and have complete control over decision making , and make all the money . To raise finance and possibily expand in size a company will often issue a number of shares - they effectively sell you a portion of the company , you then make or lose money and make the decisions jointly with other shareholders .
How to buy shares ? You can buy individual stocks from all the major companies - from British Gas to ASDA Sainsburys and Tesco via an independent broker who deals direct (or via a brokerage) with the stock exchange . Perhaps the easiest and one of the safest ways are via the hgh street banks , but expect to pay high commission fees compared to some of the small brokers . If dealing with a smaller stock broker ensure they are IFA registered .
Risks ? You share all the risk of the company , so a bad performer - or one that goes bust could lose you all your money . Also the overal stock indices can plummet for various reasons (but usually recover) , such as for political reasons - on 16th Dec 1992 the UK Conservatives pulled the Pound from the ERM (European Exchange Rate Mechanism) Black Wednesday resulting in huge devaluation of pound sterling currency , trading losses and a near collapse of the UK stock market . Millions of pounds were wiped out over night on shares - this was the time to buy ! just before the stock market bounced ... Black Monday Oct19 1987 was a world stock market crash - the Dow Jones Industrial Average collapsed and stock markets all over the world all plummeted , no one has given a prcise reason as to why this occured , (the stock market can react to a huge number of events - news - politics or even weather so underlying causes are ofeten hard to predict) . In general though it can be said the trend is always upwards on the averaged stock market graphs - and have historically always out perfomed safe investments many time over - it is for this reason investors should consider investing for several years atleast , and not necessarily react to the occasional dip in the trend . Which Shares ? Safe shares include all the big companies - particularly those that are performing well such as Tesco shares Sainsburys and large corporations in the developed nations of the west . The safest shares will usually yield far less returns though than some of the risker shares like startup companies - and overseas shares - the far east - China stock exchange is one to look out for ! During the early 90s there was the so-called Dot Com Boom when a huge number of new internet companies were floated on the London and New York stock exchanges , many offering technologies related to the new world of the internet , many of these brought huge rewards to their investors - if you can spot an emerging market it can be very fruitful , but beware shares can be over valued ! Many of these technology companies lost lots of money later on when the "dot com bubble" burst - so it was not good news for investors who purchased stocks later on in the cycle - The trick is to jump in quick - wait for an emerging market , or take advantage of a Black Wedenesday . China is set to become a 1st world super power in the next 20-30 years , this could be the next gem ! Income From Shares Capital growth - All shares appreciate or depreciate - according to profitability of the company you have invested in . Some companies offer offer a share of profits by iissuing a regular payment to their shareholders called a dividend . Dividends usually take the form of cash but can be delivered as more shares - dividend paying companies can be particulalry atractive if you need an immediate income from your investment - perhaps you are retiring and want a risky investment .
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