How do people actually get money from the stock market?
Like if you buy an share of an company for X amount of money (the average) how do you actually get money from the investment? When you sell it? But if you sell it and the current stock is only going for X money per share around what you paid for it how do you make more than say the say $10 the stock went up?
(say $10 up after you bout it)
*bought (sorry lol)
August 16th, 2010 at 6:27 am
You sell shares for more than you paid for them usually. There are other ways but it gets complicated fast.
August 16th, 2010 at 7:18 am
You only make money if the stock goes up when you sell it or the stock gives you dividends.
August 16th, 2010 at 7:34 am
You buy the stock and hope that it rises in the future, you can also get dividends from the stock if it’s a stock that pays one. If you buy a stock for $10 per share, and 5 years later it’s still $10, then you haven’t made anything if you sell it. But if you bought Berkshire Hathaway in the 1960’s it was selling for about $10 per share. Now, it’s selling for over $100,000 per share. Nice return, eh?
August 16th, 2010 at 8:23 am
You receive money from selling stock; however, you have to be careful about selling too quickly and risking capital gains tax. It’s best to stay in for the long haul.
August 16th, 2010 at 9:15 am
You get money from the stock market when someone buys your stock back from you. Normally this isn’t a face-to-face sale like retail, it’s more like selling a house through a real estate agent. Instead of an agent managing the sale there is a broker. And instead of MLS listings, offers, and counteroffers, there are exchanges offering stocks at certain prices, which move with supply and demand, so it’s much faster and efficient.
In more general terms, the common ways to make money from a stock are by selling it for more than you paid for it and by collecting dividends. Dividends are normally paid quarterly and you have to hold the stock a reasonable amount of time to benefit from them. Another way to increase your return over the holding period is to sell options against your stock. This can increase return from 0% to perhaps 50% per year if it works out perfectly, but it considerably increases risk and most people would say you’re a fool to try it.
August 16th, 2010 at 10:12 am
three ways of making money,
1. Buy on low price and sell on high price, Like I bought 100 shares of company A @ 100 and I sell it at 120, 20 will be my profit, Because I invested 100 and received 120.
2. Short Selling ( which has some limitations), Short sale is that sale which is future trade, like I sell 100 shares of A @ 100 to Mr.X and tell him that on 5th of july I will buy it then you will have physical pocession, See I don’t have those shares with me, But I am selling them on future date and getting money today. Thats second way of making money
3. Receiving Dividend, Dividends are profit of ownership that is distributed to shareholders because they also have ownership of company, They are offered on Quarterly basis, Semi Annual basis, and on yearly basis