The shares represent a share in the ownership of a publicly traded company. Companies issue shares to stimulate investment in their business. These units are entitled to part of the profits and assets of the company and are traded on official exchanges or over-the-counter markets.
There are two ways to make a potential profit from investing in stocks:
1. When investors buy shares of a certain company at a lower price and sell them at a higher price, they will generate profits. These are known as capital gains. To this end, investors are trying to identify fast-growing companies, the shares of which are attractive to both traders and buyers.
2. By paying dividends . When you buy shares in a company, you are entitled to a share of the profits generated by that company. This is known as a dividend, which can provide a steady stream of income for investors.
Most investments in stocks attract companies that are leaders in their industry. Some of them are:
* Facebook (#FB)
* Apple Inc (#AAPL)
* Amazon (#AMZN)
* Alphabet (Google owner, #GOOG)
* Microsoft (#MSFT)
* Tesla (#TSLA)
Investments in stock exchange indices
Stock market indices are also a popular investment opportunity. These indices track the performance of certain groups of shares.
The NASDAQ 100, for example, includes shares of the 100 largest publicly traded technology companies . If you choose to invest in the S&P 500, for example, you will be investing in the 500 largest companies in the United States. Other major stock exchange indices are:
The opportunities you have for investing in stock indexes are through contracts for difference or through index funds. Admiral Markets offers both options.
Before you start investing in the S&P 500 or other financial instruments , make sure that the broker you choose is regulated by regulators such as the Financial Conduct Authority (FCA)