Four reasons why you should invest in the stock market.
If you are interested in any business or sector of business, a common man can’t start the business and give their life to grow the business.
If a person is interested in multiple sectors, one cannot start multiple successful businesses.
The solution to this problem is Investing in the Stock market. If you invest money in one of the stocks, you become part-owner of the stock. Once the business is successful, you will reap the profit as a business partner.
The second reason to invest in the stock market:
Historically no other commodity has made consistent money like the stock market. People debate the investment in the stock market vs Real estate. But getting into real estate comes with its problem. Real estate is not liquid, It is not so easy to buy and sell real estate at market price.
Buying commodities like Gold and silver is subjected to price fluctuation in the market. Wastage in Gold and silver will create loss while selling. It is an additional loss along with fluctuation in market price.
Investing money in the bank is the safest option but it provides very little interest and most of the time inflation is greater than the interest percentage of the bank. It’s also taxable on yearly basis.
So if you can pick the right stock and wait for 2-3 years most of the time you might get 50-100% returns, unlike any other investment. But it is not always possible to make the money consistently. Picking the stock and waiting will make you money.
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International market:
Nowadays we have the option to invest in any market in the world. Before 5-10 years, normal people never could buy the stock abroad. After several years of Globalization, everyone can buy stocks abroad easily with the help of brokers with very little brokerage costs.
This option is not available in any other mode of investment. If you are interested in buying stocks like Apple, Google, Tesla, TCS, etc, you can buy and hold for good profits and dividends.
Dividend Income:
Many companies in the stock market pay dividend ranging from 1-7% per annum. This will be a return for anyone who holds the stock similar to interest in the bank or rent in commercial real estate. But in banks and real estate, the growth in the value will not be drastic and helps you get more than 30-40% returns per annum.
Many government companies offer dividends above 5-10%, which is for more than the bank’s interest but the growth possibility of these companies will not be the same as private companies. So before investing, please go through all my blogs to have enough knowledge before losing money.
Investing is a habit and it’s not gambling. Have the right plan before doing even little investment. Do not play with your hard-earned money in the stock market. 90% of the traders in the stock market lose money. Investors will not lose money. You should know the difference between traders and investors.
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Signing-off,
Chandramouli
