Easy Guide to Investing Stocks

Things for you to keep in mind when you are investing in Stocks:

Owning stock is owning a company

  • you have the right to be informed of material changes to the company's prospects for growth and its risk of failure.

Stocks grow two ways

  • you earn dividends on the stocks you purchase.
  • dividends + capital appreciation = "total return"

*Stocks rise and fall in value
stocks fluctuate
your goal is that the stock will increase more than inflation

*You WILL pay taxes
you want your total return to exceed both TAXES that you pay and INFLATION over a period of time

*stocks can be volatile
stocks will rise and fall by a broad percentage in a short period of time
they are usually more volatile than bonds & appreciate more over long periods

If a company fails and files for bankruptcy then their investors lose everything! One way to reduce the risk of losing all your money is to own a large number of individual stocks.

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