Stocks, a way to earn money without working, is becoming a “life-saver” for some, but that is not always the case. To get started, stocks in the United States have been around for much more than what people think, roughly 220 years. When technology was not as advanced, there were physical sheets of paper called stock certificates. Companies that held stocks gave these certificates to shareholders, or people that invest in stocks. Nowadays, people use apps such as E*Trade and Robinhood to trade, sell, and check on stocks. When investing into stocks, there are a few factors to take into account, such as capital losses and gains, variety of stocks, and dividends.
Capital losses and gains are powered by luck, knowledge, and sometimes skill. Whenever someone invests in a stock there is always a possibility to lose or gain money. Timing is the most important thing that determines the amount of money a shareholder gains from the specific stock. For instance, a shareholder could’ve bought a share for 100 dollars, but the next day it's down to 80 dollars. If the investor were to sell his stock at a price lower than what he bought, losing money, it would be a capital loss. If the investor were to sell his stock at a higher price, gaining profit, it would be a capital gain. Knowing this, investors do immense research among the many stocks to see which stock would give them a capital gain. Another important factor in investing are the dividends. Dividends is a portion of the profit that is distributed among the shareholders of a specific stock. The amount of dividend differs on the amount of shares an investor holds for a stock.
Although stocks are prominent in the United States’ economy, at the moment, cryptocurrency is becoming more notable. Unlike stocks, which are mostly from verified companies, crypto comes from developers or individuals that create a virtual object that acts as stocks. Cryptocurrency is riskier than stocks because it can be affected by a single tweet as we saw the past few months. Elon Musk’s tweet about a specific crypto known as “DogeCoin” sent the currency plummeting, taking others with it. It is recommended that beginners start with stocks, and can trickle on to investing in cryptocurrency if they are interested.
Nowadays, there have been many people becoming millionaires just from investing in stocks and investing smartly. Although working a job and having stable income, looking into stocks isn’t a bad idea because who knows, you may become the next millionaire.
Comments