Stock Markets Exposed
How EXACTLY is money made in investing?
Nothing from my research is telling me how you make money investing- does it have something to do with interest rates?
Public Comments
- no if your stock goes up you make money if your stock goes down You lose money
- Your research?
- Way one: You buy stock (or a bond) for $10. While you hold it, waiting for the price to go up, you get paid dividends {with many stocks, not all. With the ones that don't pay you while you wait, you hope the price goes up more or faster than the dividend paying stocks} or interest (with bonds). Way two: After years of holding, the price goes up (you hope) and you sell for lets say $20. Therefore you made a $10 profit (known as capital gains). Way three, four, five, etc. Sell short, buy and sell puts and calls or warrents, and other complicated means not for the beginner.
- For the investor: Buy low, Sell high = Capital Gains or Company pays you money per share if they make profit = Dividends (They aren't required to pay dividends, Strong blue chip stocks that pay them are also known as "Widows & Orphans" a lot of which are utility companies)
- Interest rates are a factor but not of primary importance. Investing in stocks you make money through capital gains and dividends. Investing in bonds you make money through coupon yields and principal gains if bought below par. Investing in cash you make money through interest. All money made has to subtract money lost through inflation, hence total real return, how money is made.
- Buy low, Sell high implies Capital Gains
- Wow - great question. There are many investments: Purchase a home, Certificates (CD's), I-Bonds, Stock Market, 401k, 403, 457, Roth, IRA's - and many other types of investments - if you are brave to start now. Somewhere in time - down the road - you will sell one of these investments. Hopefully - when you sell your investment - you will make more money that what you paid for the intial investment! That's how money is made investing!
- google for HSFX Asset Management and no more
- Boardwalk Pipeline Partners looks good to me. I bought it at $19.53 a share. The yield is 10%. The company has strong earnings 1.92/share. It paid out 1.90.
