BUILDING WEALTH WITH STOCKS MARKET(TIPS)

WHAT IS STOCK MARKET?

A stock market, equity market, or share market is the aggregation of buyers and sellers of stocks (also called shares), which represent ownership claims on businesses; these may include securities listed on a public stock exchange, as well as stock that is only traded privately, such as shares of private companies which are sold to investors through equity crowdfunding platforms.

How can you use stocks to achieve your Wealth-building goals?

 

Gathering information before and after buying your first Dollar Stock is the first tips you need to learn (You have to stay informed) 

You need to understand all the terms you will come across. Recognizing Stock Value, Understanding Market Capitalization and so on.

Market Capitalization describes the market size of a company. Market capitalization is an equity market segregation used broadly in the investment industry. A company’s market capitalization is an important characteristic considered by investment companies and individual investors. Market capitalization is one characteristic of a company used in investment analysis. It is simply the value you get when you multiply all the outstanding Shares of a Stock by the price of a single share. E.G 1million shares outstanding multiplied by $10 is $10mol market cap. 

Five Basic Stock Categories of Market Cap

1. Micro Cap (under $250mil) they are Smallest and riskiest available 

2. Small Cap ($250mil to 1Billion) Fare better and have plenty growth potential 

3. Mid Cap ($1-5Billion)stocks are useful in portfolio diversification because they provide a balance of growth and stability.

4. Large Cap ( $5-25Billion) Blue Chips safer than small cap

5. Ultra Cap (Over $25Billion) companies are typically used as core long-term investments in an investment portfolio because of their stability and dividends. 

Safety point Company's size and market value do matters. 

What do you want to achieve with your stock? 

 

What is your investment plans?  

Are you seeking appreciation? (Capital gains) or Income (Dividends) 

1. Picking out industry is important. 

2. Understanding how the world affect your stocks. 

3. Research about the company to know the inside buying and insider selling. 

4. Safe interest bearing vehicle (Have your Emergency funds) do not invest with it, keep what you need for at least 6Months. 

5. Don't buy all at once, if you intend buying 5,000units buy in batch, remember cash is king. 

6. Buy Damaged Stocks no Damage Companies

7. Look at Consumer loyalty, the service revenue stream and the cash position. How they make their money and how their earnings supposed to be (what is the catalyst) 

8. If a stock price goes down, do your DD(Due diligence) to know to cut or run or buy more "learn more about the company"