How to start investing in stocks

To many modern people, the stock market seems to be something difficult and unpromising for making money.. Citizens are confident, that only financial experts are able to make a profit when buying shares. However, it is not. The famous Warren Buffett, famous for, that earned huge capital on investment, assures, that an ordinary person will be able to make large profits when working with securities, having patience, as well as a clear strategy of action. Consider, where to start investing in stocks.

First of all, you need to choose the right company, which securities you will purchase. for example, can buy Gazprom shares, Russian oil tycoon with an impeccable reputation. This is the safest option, lower risk, therefore suitable for novice investors.

Investing in stocks is as follows. Even a large enterprise needs financial resources to develop, therefore it issues shares, sells them, thus attracting investors. The proceeds are invested in business development, and the income received is subsequently paid to investors. It turns out, that the issuing company itself is beneficial, and shareholders.

There are two types of stocks: simple and privileged. In the second case, the holders of these shares have the right to a stake in the company, can take part in determining the strategy of its development. Besides, with preferred shares, dividends are paid. Ordinary shares, as the name suggests, do not have such privileges.

There are two main options for generating income: receiving dividends and subsequent sale at a more favorable rate. Accrual of dividends is as follows: the company makes a profit, after which holds a meeting of shareholders, on which a specific percentage of payments is determined. Remember, that many modern firms issue non-dividend shares, which can only be earned by selling them.

Beginners can buy so-called "growth stocks", that is, securities of organizations, which are characterized by high rates of development. They rarely pay dividends, however, they allow you to get a good income in the short term.

The second option for newbies is buying undervalued stocks, which are sold at a price lower than real. In this case, it is possible to receive income from the exchange rate difference during the subsequent sale. However, in this case, one has to wait several years before that time., when the stock price rises.

Experts recommend that novice investors pay attention to the so-called "blue chips". These are stocks of stable corporations, for example Gazprom. certainly, huge profits won't be made, but the risk is minimal.

To start investing, you need to find a broker, through which all stock transactions will be made. He will help you open a brokerage account, on which the client will need to put a certain amount of money. You can only buy shares from this account.

Remember, that making money on stocks is quite real, but do not rely on success or your own luck. Every decision must be preceded by a deep financial analysis.