where and how to do it?

invest in the stock market

Investing in the stock market means that you own a share of the company in which you buy shares. As your business grows, you can expect the stock to pay off your investment. If you have some money saved and want to use it, investing in the stock market might be a good idea.

How does investing in the stock market work?

Investing in the stock market is the purchase of shares owned by a public company. These small shares are known as company shares, and by investing in these shares, you hope that the company will grow and do well in the future. When this happens, the value of your shares usually increases. Therefore, some investors may buy them from you for more than what you paid in the beginning. This means that you will be able to make a profit if you decide to sell them.

invest in the stock market

Why is it important to invest in the stock market?

Investing in the stock market is much easier than most people think. The stock market has safety, profitability, liquidity and flexibility that far surpass any other type of asset:

  • Earn higher returns: The primary reason most people invest in stocks is the potential return compared to alternatives such as bank certificates of deposit, gold, and Treasury bills. For example, the average return on the stock market has been about 10% per year since 1926; long-term government bonds yielded 5-6% per annum over the same period.
  • Protect your assets from inflation: Stock market returns often far exceed the rate of inflation. For example, since 1913, the long-term inflation rate has been about 3.1% per year. That’s comparable to double-digit annual stock returns. Stocks were a good hedge against inflation.
  • Earn regular passive income: Many companies pay out dividends or a portion of their profits to investors. Most companies pay quarterly dividends, although some companies pay monthly dividends. Dividend income can help supplement an investor’s salary or retirement income.
  • Pride of ownership: A share of stock means partial ownership of the business. You may own a small share of a company whose products or services you like.
  • Liquidity: Most stocks are publicly traded on a major exchange, making them easy to buy and sell. It also makes stocks a more liquid investment compared to other options, such as real estate investments, which you can’t sell quickly.

invest in the stock market

The best investments in the stock market

Investing always involves risk, but in these sectors, your money is likely to grow. Because these industries have historically produced the best results.

  • Health care services: an important sector that has not been as badly affected by crises and recessions as the rest.
  • Technology: The consumption of data by the world’s most important companies has made investing in technology a great idea.
  • Discretionary consumption: Includes luxury products and services or those designed for pleasure and entertainment, such as Netflix, Disney+ or Starbucks.