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Why Investing in Stocks Is Good

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Submitted By morales58
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You might have heard about people talking about buying and selling stocks, and I'm here to tell you what they are and why you should invest in stocks. First of all, you might be wondering what are stocks? A stock is an equity investment, ownership in a company. For a corporation, equity capital (money that a business gets from its owners) is provided by stockholders who buy shares of its stocks. Since the stockholders have a stake in the company, they also share in the triumph of the company. When the company has a great year, that means that your stocks will increase too which is how you make money with stocks. Another way to make money, is by getting paid dividends. A dividend is given money, stock or other property that a company pays to stockholders. The dividends are paid out of earnings which is why a stockholder would share in the triumph of the company too. One thing to note, is that a company is not required to pay out dividends. When a company has a bad year, its board of director's may choose not to give out dividends and instead use that money to cover some of the expenses for that year. A company may also keep some of the earnings to help pay for expansion, research, and product development. So, if the company has a bad year that means that their stock value well go down in price and if you own some of their stock you could start to lose money. Here's an example on how you might buy and sell stock, say you buy stock, now you should've have done some research before and have thought now was a good time to buy this company's stock, you would keep this stock and watch it grow and sell it to another buyer. Now, you would want to sell your stock when you see your stock rising and think now is a good time to sell because generally it's better to keep stock over the long run, but I'll explain that in a bit, you might also sell it because you might think that

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