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Most Americans invest in the stock market as way to grow and increase their savings and retirement. Today, more than 50% of all Americans have money invested in stocks, bonds, or mutual funds. Whether you have $100.00 to invest or a $100 million to invest, the principles are the same and the basics of stock market 101 remain steady. With the right information and investment advice, anyone can be a winner. In simplest terms, a stock is a share in the ownership of the company. Stock represents a claim on the company’s potential earnings and assets. As investors purchase more stock, their stake in the company, and the potential for higher earnings, grow. Profits are often paid out as dividends, and the more stock owned, the more dividends reaped. Many investors purchase stock as part of a long-term wealth management strategy. Other investors are focused on short term gains. Either way, the stock market 101 tip is “buy low; sell high”. Novice stock investors may not know how to implement this simple stock 101 tip. Stock prices fluctuate daily (even hourly), as a result of the free market economy. Share prices changes because both the demand and supply of those shares change. If more people want to buy a company’s stock, the price goes up. If more people are selling the stock, the stock price falls. The price of a stock is reflective of what people- both investors and the general public- feel the company is worth. Investors and analysts watch the stock’s movement and try to predict the best times to buy and sell the shares. The most important factor to study when deciding on a stock is the company’s earnings. The earnings are the profit a company makes. Companies traded on Wall Street (via a stock exchange) are required to report their earnings quarterly to the Securities and Exchange Commission (SEC). If a company is making more money than expected, you can count on the stock price to increase. Subsequently, if the company made less money than projected, the stock price will drop. Many people buy stock using a brokerage firm. Full service brokerage firms offer advice and manage your portfolio for you. They charge higher fees than discount brokerage firms, which do not provide advice, research or personalized customer service. Online brokerage sites allow anyone with a bank account and some money to invest in the stock market. There are a number of reputable on-line sites that can help you research the earnings history and potential of any company that interests you.The financial media, whether online or on television can also provide expert advice and analysis about the stock market. The basics of stock market 101 are simple. Buy stocks when the prices are low. Determine if your strategy is designed for long-term growth or short-term capital gains. Identify when you feel you should cut your losses and when you feel you can ride the volatility of the market. Stay informed about your portfolio and make decisions accordingly. Are you looking for more information regarding stock market? Visit http://www.smart-investing-in-stocks.com/invite.html today for more information!
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