What is investing in stocks?

Fine, Let’s start this conversation from the beginning that means from the root. You all should admit that investing is not an easy task to do. Each of you must have even a little knowledge about investing because we all live in a cooperative world. There are several investing procedures and investing assets we could get used to. Investing in stocks is one among them. Investing in stocks is also one of the simple ways to start investing for beginners.

If you are an individual above 18, you have the opportunity to use invest in stocks to earn money with the time. But keep in mind, you have to be more accurate in making decisions because investing in stocks has a big influence on your decision-making ability. The majority of people define investing in stocks as a risk calculator by judging the book by its cover. Ask about this opportunity from an expert in the field, they will enlighten you for sure.

Let me get your attention to the simplest definition about invest in stocks. The simplest form tells us, investing in stocks means buying shares of an ownership company. So, suppose you are the one who buys those shares, then you will become a shareholder of that company.

Investing in stocks has the same risk like invest in gold. The main thing you have to be aware of in every aspect of investing is, please try to do more and more inspections about your investing asset. This could be more lucrative if you do the analysis correctly.

If we broaden up this simple sentence, Think like this. You are one of the high yield businessmen in the country and you need to invest your money in specified business activity. Business capital is a must in such type of work. So you invite a few of your friends to join your business by investing fractional shares of money in the business. That fractional share of the money is known as a stock. Likewise, you have the opportunity to invest in stocks with the help of a brokerage company. You have the total authority in choosing the brokerage company you need in investing.

What are the ways to earn money through investing in stocks?

There are millions of people involved in this earning criteria without any fear of losing their money. This is a world-recognized earning method that you can use to invest your money with 100% confidence. No one would like to give up any money gaining opportunity because of its hard nature. Remember, the risky ways are always the most valuable ways of earning money.

People have found ways to minimize risks and continue to invest in stocks as a fine income generator. You have to jump into the water If you have any idea to learn how to swim. So getting to investing is up to you and experiences will solve it all.

You have the authority to sell your company shares to another buyer, as soon you received the expected value for the stocks. Stocks are one investment asset that can produce a profit with time. So think you reached the expected value of your shares, then you can sell them to another party who is willing to buy those shares to the existing price tag. This may give you quota a which may be a multiple of the amount you invested earlier.

Suppose your company decided to distribute profit among the shareholder’s community. This can happen after six months or one year you received the stocks. As a stockholder, you also have the opportunity to receive the profit margin relative to the stock amounts with you. These small profit pieces are known as dividends. As per the ratios normally dividends volume is directly proportional to the number of stocks which you have bought. So if you are able to invest more money in the best company after inspection, you will have the opportunity to make more money.

What you should be more aware of invest in stocks.

01. Diversify your investment portfolio.

This is a common theory among investors. They do not invest in stocks as a whole, which means they diversify their investment portfolio by using different categories. Suppose you have $1000 and invest that whole in a medical company. Eventually, you can understand that keeping that whole volume in one company is a risk at all. If that particular medical company lost its way in the field, you are a goner.

You would ask me “How a company can fall down like that ?’. There are many reasons for a company to lose its way. Bad leadership, Internal conflicts, Not adjusting to modern technology likewise there may be many reasons which can affect a company falls down.

But at the same time think you’ve invested in stocks like below.

  • $ 200 in a medical company.
  • $200 in the bank field.
  • $200 in a clothing company.
  • $200 in a paint company.
  • $200 in a food company.

The above investing criteria can minimize your risk. The lucrative of the above method is, suppose two of your companies showed downfall. You can keep the hopes about

the other three companies and that is called minimizing risk. Finally, I have to say, diversifying your investment portfolio can save you in the future.

02. Go through parent company reports.

You have to choose a company also you have to be knowledgeable about the selected company. Investing in stocks may be a major risk if you fail to analyze your company. Some would stay away from analyzing the company reports saying, “I have hired a brokerage company. They will look after everything”. Nope, you are the one investing in stocks and that is all your money. So you have search about the company either you have hired a brokerage company to look after your invests.

Below are some major facts you have to consider in choosing a company to invest in.

  • History and historical reports of the company.
  • Refer both fundamental and technical analysis.
  • Company’s higher management and workforce capacity.
  • Survival of the company in previous difficult situations.
  • Company category (field) and future profitable criteria.
  • How company adapt the economic challengers of the region.

Please try to be more aware of the above facts, so you may find it easy to take the final decision about investing in stocks. Take the experience from time to time, and after about two or three years you will be able to read all those data from the mind.

03. Ups and Downs of the world economy.

The world economy can affect positively or either negatively a country or a region. If you are willing to invest in stocks you should really be concerned about the economic situations of the country or region. As an example, we had a covid-19 situation so many companies lowered their stocks at that time. Now we are witnessing a war in the upper part of the world, and also we can see some companies have lost their way in many countries. The economic recession has been able to higher inflation.

You may have a question “ How do we know, the pandemics and wars do not give any clues”. That is the real twister and risk in these investing games. We never know what will happen in the next minute. But there may be both wins and losses in this investing criteria.

Think of a medical company that gains profits in any situation. I’m not being rude here. But a medical company, food company, and many such types can gain their profits in any kind of situation. One thing, such company shares may be higher in value. But try to look for such an opportunity.

04. Find a better brokerage company.

Investing in stocks can be done via a brokerage company. Here an investor is looking for the most trusted brokerage companies. There are many online companies that provide brokerage facilities for stock investors. Below are some world-famous, trusted online companies of 2022.

It is your responsibility to use your money wisely. You have total freedom to select the best investment in stocks brokerage company as your wish. Do best because this is one point you have to be smart in investing. Some people get it wrong at this first point and then feel about the money which they invest in stocks. But most of the people who really have a better knowledge about investing try to start with the best. So consider this as an important step t fulfill as an investing personality.

Pros of investing in stocks.

  • Economical growth can effect more positively for any kind of stock investment. If a country or region, making positive income ratios with the time that means you will definitely receive dividends for sure.
  • In most of the countries, any individual above 18 has the easy opportunity to involve invest in stocks.
  • No need a huge amounts of money to involve in investing. There are some companies which offer their stocks above $1000 each. But most of the companies have lower rates than that.
  • Additional income through inflation benefits and dividends.
  • Liquidity.

Cons of investing in stocks.

  • Risk like all other investing assets.
  • Broker company stock holders getting paid at last after company management, employees and all.
  • Analyzing take some time more than you expect.
  • Uncertainty on Ups and downs of profits.
  • Either your experience not matters, you have to compete with the professionals in the field. Because most of the institutional professionals involve in this stock investing.

So you need to know there are Pros as well as cons of investing in stocks. But if you can be wise in the point of releasing your money, you have more benefits to obtain through investing in stocks. Investing is one thing that can make successful business careers. So becoming an investor using any asset may be more lucrative for your future.

A person should earn money for three things. You have to spend on needs, save some money and also invest some money in any chosen asset. Balancing this is what we call balancing personal finance. So try your best to balance everything.


If I tell you more about Salika Wijesinghe, I was a former General Insurance Analyst, a former customer service associate in a telecommunication network, Former customer service executive in a bank. Now I'm really very happy to share my knowledge with each and every one of you. Also, I represent a kind-hearted world community because I love helping people as well as animals. I hope my ideas are helpful, so you would find it easy to step forward in this life journey.

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