Lots of people called themselves "stock market investors", but does everyone of them know the exact definition of stock market? Why does stock market exist? Some of my friends regard stock market as casino. Some of my friends even commented that I am gambling in stock market!
No no no no no, stock market is not like a casino, at all!
However, some of the "investors" (I prefer to call them "speculators") do treat stock market like gambling. That is because of their mindset and perception, stock market by nature is never a place for gambling.
Gamble requires a lot of luck and very little on skill and strategy. Investment is the opposite - needs patience, knowledge, strategy and just some luck.
Stock market exists for 2 main reasons:
#1 For corporation/institute to get more money to expand their business, create new product lines, improve Research & Development, etc.
#2 For people like you and me to invest or own part of the business you are interested in.
Many of us want to own a business but due to many reasons, not everyone can own a business. By investing in stock market - purchase some shares of a listed company, you own part of company and business.
A book about stock investment said if we own a company's shares, we have to make sure we provide the business to our "own company" but not its competitors. For instance, if you own some shares of McDonald's, you should always go to McDonald's for fast food but not KFC, Burger King, etc.
Are you a shareholder of your favorite brands - bank/restaurant/boutique/real estate/etc?
Saturday, April 26, 2008
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4 comments:
agreed with u that investment is not a gambling and its need to have patience, knowledge, strategy only will gain the return.
i hope i am one of the shareholder and invest them for my own return :D
I think whatever stock you are holding is the one that i am contributing la!!! heheheh
hh: you should start investing when you are young, start early! how I wish I know about stock market at a younger age, but never mind, I am still young, under 30 mah :)
beautiful life: contributing? ha ha you mean you are my business' customer? thank you for your support and I hope you will continue to support my business so I can get more and higher dividend, also capital gain on share price!!!
Hi i live in new zealand, i'm 25 years old and have worked full time since 18yrs and have just started educating myself about the stock market.as i am still learning i want to find out How to find good companys to invest in for the long term? do i need to fully understand annual reports?
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