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Welcome....
to the shares page.
Now we are going to discuss with you the following. What are shares and how do they work. How can you become involved with and profit from shares. And lastly what you need to do before you can purchase shares.
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What are shares and how do they work?
Shares are essentially a part ownership of a company or a share of that company. When you buy shares in a company you own part of that company. The benefit of this is that when the company does well financially the share price increases because more people buy shares in the company and are willing to pay more for them. So your shares go up in value. The other way you can make money is through dividends.
When a company has a profit it may decide to share some of that profit with it's share holders in the form of a dividend which is given out by cheque or straight into shareholders bank accounts.
The main reason a company would offer shares in their company is to raise money. Often this money is used to help the company move forward, pay down debt, as working capital or for growth strategies. You take a risk by buying part of the company in shares but ultimately if the company does well you and your shares benefit.
Shares are traded on the Stock Exchange day in day out and rise and fall all day as buying and selling takes place.
What are the benefits of Shares?
There are many benefits of shares and share ownership versus conventional investment such as property.
Apart from shares being proven to be one of the best long term investments they also have great tax benefits such as franking credits and reduced capital gain taxes for shares held over 12 months.
Some of the other advantages of shares are how flexible they are as far as buying and selling goes. If you are looking at buying or selling shares in most of the major companies traded on the Australian Stock Exchange there is normally very good liquidity. This simply means there a re normally many buyers and many sellers so you can buy or sell shares very easily. And now with online broking you can literally put in an order to buy or sell shares from the comfort of your own home and have a completed transaction almost immediately placing the order.
Compare this to property. It can often take months to sell a house if you need to free up some money or sell down your portfolio of investments.
Another benefit is the very low initial investment amount required to participate. You can invest in shares with as little as $500 Australian which makes this an achievable goal for almost anyone.
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What do I need to do to get started?
Ok, it's actually allot easier than you think. Basically to buy or sell Australian shares you need a broker. We recommend Minc Trading as they have an excellent trading platform, track record and will even help you with advice on what shares to buy and sell to help you make money. Alternatively if you would like to see other Australian Stock Market brokers just go to our broker page.
If you would like to use Minc Trading which we recommend, just click on the link below to get a free trial to their stock picks and trading platform and to sign up if you wish.
