Is Investing in Stocks for You?

When you say the word, 'investment,' most people's minds go straight to the stock market. Stocks are widely recognised as one of the most popular forms of investing. Yet while millions of people are already out there, trying their hand at investing in 'the market,' there are still many of us who are a little tentative to take the leap.

Successfully investing in the stock market can certainly prove difficult but here is a selection of information which will help you confidently take the first step into growing your portfolio.

What are Stocks?

Investing in stocks sees you purchasing a part of an established business. You literally become a part owner of the company in question. Stocks are viewed by many as more of a long-term investment. They're certainly not for those who are looking to get in, hit the market hard and get out with fistfuls of cash. The stock market is certainly a risky business and more often than not to successfully watch your investments grow within the stock market, you need to be prepared to be patient.

Benefits vs. Risks

If anyone tells you they have a risk-free way to make money on the stock market, you should run far into the opposite direction as you're about to be scammed. Stock prices for a company are very temperamental and can fall dramatically, sometimes to nothing at all! If a company falls over and goes broke, the investors are last in line to get paid and depending on the circumstances may never get their investment back. That, of course, is the worst-case-scenario however there is no denying that the stock market can certainly be a risky place for an investor. That is why you must be vigilant in researching specific companies prior to making any sort of investment.

That being said, there is no need to hide underneath your bed when anyone mentions the stock market to you – for the discerning investor there are definitely benefits to be had. If an investor selects an up-and-coming company to invest with the probability of profit is quite high considering the stock market's tendency to have an upward trend. In addition, stocks have a far great liquidity than other securities which means they can be more easily converted in cash if you choose to sell your stocks to other trades on the market.

As with any form of investing, there are certainly pros and cons. If you're switched on though and prepared to do the research, the stock market is an incredible investment opportunity – one that's certainly worth emerging from underneath the bed for.

As always we suggest that you consult a financial adviser prior to making any decisions pertaining to your financial dealings.