5 Things to Know About Investing
Thinking about starting your
portfolio? Or maybe you’re already a small time investor looking for a little
more education. Either way, there’s no shame in not knowing all the ins and
outs of markets. And sometimes, just getting familiar with the most basic
concepts is all you need to make you feel more comfortable investing.
With that in mind we’ve got 5
investing basics to start you off:
1. OWNING
A COMPANY (OR AT LEAST A LITTLE BIT OF ONE)
When you purchase a share on the
stock market you may ask, what am I actually buying? You know
your money has gone somewhere, but other than some documentation you don’t get
much back. So it’s a good question to ask.
The answer: You own a percentage
of the company (or companies) of the stock that you just bought.
If a company has 100 shares and
you buy 50, you own 50% of that company.
If you buy 10, you own 10%.
If you buy 1, you own 1%.
You’ll usually own much, much
smaller percentages than that, but no matter how much you own, if you have a
share you have a legal stake in that company.
2. THE
MARKETS CAN GO UP AND DOWN
One of the greatest myths of the
stock market is that they usually go in one direction, up. We can very much
bust that myth and tell you they also go down.
Over days, weeks, months, and
years the markets can move in both directions. This is important to
bear in mind to avoid nasty surprises.
Read more: Dollar-cost
averaging
3. DIVIDENDS
You’ve probably heard of
dividends, and you’re definitely forgiven for not knowing what they are.
Dividends are a portion of a
company’s earnings, paid to their shareholders. Usually a way for shareholders
to enjoy company profits.
If you own 10 shares of a
company, and they pay a dividend of $1 per share, you get $10 ($1
x 10)
Read more: What is a dividend?
4. INVESTING
IS FOR EVERYONE
You’d be forgiven for thinking
that you need a fancy suit and a degree in finance to invest in the stock
market. However, you don’t. Anyone can invest in publicly
listed companies, because they are as the name suggests, public! Just like
kicking a ball around with your mates on a public oval.
We suggest you do your research
and think about your personal situation before making any investment decision.
With apps like Raiz around anyone can invest, any time they want, with as
little as $5. For more information on Raiz fees, click here.
Read More: Unique Ways to
Invest with Raiz
5. ROME
WASN’T BUILT IN A DAY
This isn’t the Wolf of Wall
Street, and sadly we’re not Leonardo DiCaprio. When most people invest they
don’t do it to get rich quick. Building a portfolio and letting it grow takes
time, but like much of life, good things come to those who wait…
… but don’t wait until tomorrow
to start investing. Now you know the basics you can start building your
portfolio today!
Important Information
The information on this website is general advice only. This means it does not consider any person’s investment objectives, financial situation or investment needs. If you are an investor, you should consult your licensed adviser before acting on any information contained in this article to fully understand the benefits and risk associated with the Raiz product.
The information in this website is confidential. It must not be reproduced, distributed or disclosed to any other person. The information is based on assumptions or market conditions which change without notice. This will impact the accuracy of the information.
Under no circumstances is the information to be used by, or presented to, a person for the purposes of deciding about investing in Raiz.
Past return performance of the Raiz product should not be relied on for deciding to invest in Raiz and is not a good predictor of future performance.
