Shares, stocks, or equities- are all different in terms of spelling, but they only have one meaning, and that is actually just a single unit of ownership of a particular company.
Now, you could just save your money, let it stay in your bank account, and just enjoy the interest rate that the financial institution provides. Although that is something that you want to do, you might want to consider getting into the share market.
You see, saving your hard-earned cash in the bank should be something that you must do, but trading in the stock market provides an avenue for your money to grow exponentially.
If you are interested to know more about it, I am going to list some handy tips that will help novice share traders to be part of any share trading company in Malaysia.
1.Money from Shares?
Think of putting your money in the stock market as an investment. You look for a particular company and buy its shares. There are two ways you can earn by investing in the stock market:
- Buy and Sell- This is the best way to get more profits. The idea here would be to buy as many shares at the cheapest price possible and share them for a much higher value. You do this by researching and looking at the trends.
- Dividends- This is where you get a small commission from the company’s profits. Usually given twice a year, think of this as the company’s gift to you being one of their shareholders. Take note that the organization can choose not to pay you dividends, but instead, they could invest it in their company for more growth.
Now that you know how to gain some profit in the stock market, the question now would be how much money do you need to start investing?
Well, there actually is no set amount that you need to deposit in your trading account. However, there are some stockbrokers that will ask you to do an initial deposit of, say, $2,000 to help you get started in buying those shares.
3.Risk-Taker or Risk-Averse?
This question revolves around you, the would-be investor. Are you willing to take risks or do you want to avoid it at all costs?
You see, the share market is filled with companies that have different potentials for growth. You could start being bold by investing in a hot stock which promises better gains, but can also quickly fall if you’re not careful.
You could also invest in blue-chip stocks or buying shares from well-established companies so that your money will be safe, knowing that these companies have been operating for quite some time now. The difference is that investing in these stocks would mean that you’re not really going to earn a lot more than getting hot stocks. Still, the choice of buying shares is entirely up to you.
4.It Takes Time
This is where novice traders really fail at. You see, the share market is a type of investment and if you put your money into it, it means that you’re not going to be getting maximum profits in a short amount of time.
We are talking by the years here. In fact, most professional share traders would agree that you have to invest, buy, and hold your shares for a minimum of 5 years before you sell them or buy another set of stocks.
If you are not patient and you want to gain money as fast as possible, you’re better off investing your money on something else.