The rewards of investing in shares

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Basics of Share Investments

  • A share is nothing more than a percentage of a company’s value and by owning that percentage you are banking on the growth of that company’s value over time. The greater the increase in value, the greater the return on investment to you.
  • There are a multitude of factors that influence the fluctuations in company values that are represented by changes in share value. Differentiating between these factors at any given time is a process that takes years of dedication and study to fully understand and is best addressed on a specific basis with a qualified financial advisor.

Capital Growth

Capital growth is a term that is often used to describe the mechanics of selling shares that have increased in value for a profit. This growth is by no means an assured result and consultation with an experienced advisor is recommended ahead of any sale or purchase of securities.

 


Risks of Investing in Shares

  • A company’s financial performance is a key factor in determining its valuation and changes to it.
  • Share values are most directly influenced by market perception. What the market is willing to pay for a company’s shares based on its perceived strength or weakness at any given time can see great swings in corresponding share values.
  • Shares are the most commonly encountered of all investment instruments and come in a variety of classes and types. When opting for which stock to invest, proper research and understanding is essential and we recommend using the services of an experienced advisor ahead of any investment.
  • Every investment, including those made in the share market carries inherent risk. There is no guarantee that the value will increase in a specific timeframe.
  • Risk and reward must be fully appreciated for every investment, including shares. In general, the better returning an investment, the higher the risk it carries. This must be factored into your investment strategy.
  • No matter how well shares in a company may be performing, making an investment of a singular nature is a highly sensitive and risky decision. Without portfolio diversity, any change in market conditions can cause serious depreciation in the investment without the ability to compensate for losses. Please consult with a professional financial advisor to help diversify and reduce inherent risk carried by your investment portfolio.

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