Buy stocks directly on the stock market
There are many options available for you to invest in the stock market. Indeed, the financial market today is becoming more accessible due to the development of brokerage companies. However, only one option remains the most obvious and most recommended. And this applies to the direct stock market. In fact, to invest in the stock market, you can buy your shares directly in the stock market. This investment approach is much more suitable for long-term and medium-term investments. Here you do not need a financial intermediary to make your investment.
However, you can always entrust the purchase of assets to a financial institution that will take care of the transfer of your order to the market. In any case, the investment will be made within a centralized market. In addition, direct investments in the stock market can be made in different ways. But this is not the only possible option for investing in the stock market.
Bearer or registered shares: what to choose?
As for stock market investment options, you can choose registered or bearer. Ownership of shares directly in a registered form involves investing directly in a listed company and maintaining its assets in the latter. This allows you to take advantage of some privileges in the listed company. This can be the right to vote, access to general meetings, receive annual reports or increase dividends.
The disadvantage here is that management is provided by the company’s financial intermediary. This means that if you want to choose this method, you will have to open an account with each company whose shares you buy. Therefore, it is also interesting to consider the option of holding bearer shares. Declaration of income can be extremely difficult when conducting regulations.
Also, if you do not create a holding account for each company, you may choose to hold your bearer shares. This way, you have the opportunity to own your assets in PEA while remaining anonymous. The advantage of this solution is that it allows you to fill out a single tax form for all your securities, all companies combined. And this is against a single tax form on the line of a registered company in the case of registered ownership. However, this is due to storage and management fees, which can be very high.
Investing in the stock market with the help of UCITS
In addition to the two classic holding methods we have just developed, you can also invest in the stock market through UCITS. These are collective investments in transferred securities, which are envelopes consisting of a large number of securities. They can combine several categories of exchange products. This greatly facilitates the storage and diversification of portfolios. It also manages the portfolio by a specialist who decides which asset you should buy and the ideal time to invest in the stock market. However, you will have to pay a fee for managing the various transactions made on your account.
Position yourself in the stock market on ETF indices
To invest in the stock market, you can also use index funds and / or thematic funds, which are ETFs. They were designed to reproduce stock market performance. This can be an industry or geographic index. The peculiarity of ETF trackers is that they reproduce the increase or decrease in productivity of their base element. Note, however, that the management fee for this type of tool is one of the lowest on the market. And not without reason, ETF management is first of all passive management.
Investing in financial markets through derivatives
Investing in derivatives is also an option for your financial investment. In general, for speculation in the short term, it is recommended to choose products that include the lever effect. This is not about long-term investments, but about short-term negotiations. However, this method of investing is not recommended for beginners. It is designed exclusively for advanced traders who have experience in the stock market. Indeed, derivatives are quite complex in their functioning and composition.
In addition, the leverage effect they have in mind increases the level of risk for investors. In the case of poor quality analysis, the losses will be significantly high. However, the benefits you can achieve with this type of product are invaluable. That’s why before you trade them, you need to learn more about them and understand how they work. This will allow you to reduce the risk of losing and maximize your chances of winning. Finally, you can use derivatives as a portfolio hedge for your long-term investment.