What does a novice investor need to know?

What does a novice investor need to know?

Trading on the stock exchange and investing is not as easy as it might seem at first glance. Due to the banal ignorance of information, you can lose large amounts of money at the beginning of the journey. Therefore, in order to start with minimal damage, you need to study all aspects and subtleties of such activities.

It is especially important to choose a suitable and reliable broker that has already established itself in the market and with which you can earn money. It could be FBS Nigeria.

What is the investment?

In the modern world of the Internet, the process of investing has become much easier than it was 30-40 years ago. Therefore, the rules of the game, in this case, have really changed over time, and you need to adapt to the updated trade. Therefore, now we will take a closer look at what investing in the modern world is.

Investing is investing in securities or currencies to save capital or earn extra money.

What does it mean? Securities can be stocks and bonds (the most common options). For example, you buy a share – this is already called investing – and then the issuing company pays you dividends every year. Dividends are the funds that a company pays you out of its profits, and what you invested in it. This way you earn money and recoup your investment.

Who is an investor? An investor is a legal or natural person who invests in the development of a company in order to receive income from the profits of this company in the future.

So we can see that both sides win in this situation, because the company receives additional funds for scaling and development, and then shares a certain percentage of profits (dividends) with the investor.

Earnings on investments

Earnings on investments are possible with small capital, but, of course, it will be better when you invest a large amount of money. So your profit will be more tangible. The algorithm of earnings is that you purchase securities on the stock exchange, that is, you have invested in some company. Then this company, where you invested money, is obliged to pay dividends to you. This way you earn money and recoup your investment.

How to invest money?

Above were given different types of investment, therefore, respectively, for each a different algorithm of actions.

We also want to provide general recommendations that give a clearer understanding of how to invest correctly:

  • Read a lot of information about the structure of the market, its algorithms, price ranges. Having the necessary knowledge, you will significantly reduce your losses in investing.
  • Do not be afraid to contact specialists who have been working in this area for much longer, their advice will not be superfluous.
  • Investment is always about the long term. Therefore, choose companies, banks and organizations in which you are sure that they will remain on the market for at least 10 years.

And most importantly – don’t spend your last money, always have a financial airbag.

Read More: How to Spot and Treat Burnout