It’s not unusual to hear horror stories about how someone lost all their money in stocks or how it’s an addiction like gambling. It’s understandable that if you give too much ear to these stories, without being properly informed about the stock market in general, you’d shy away from investing. Yet, market investment is not any more or any less risky than other types of investment. You might think you have made good savings for your retirement, for instance, but outlive those savings, which is a risk.
It’s said when it comes to money, there are basically three types of people in this world. People who have to live from hand to mouth, people who take the safe path and spend their life paying back personal loans, and those who use market investments as one of their several sources of money.
If you want to join the third group, here are some reasons why market investment is worth your time, energy and money.
Highest Returns:
Out of all assets, the stock market offers the highest returns. Given that investment returns do fluctuate, but stocks have outperformed other types of investments during the past two centuries. While nothing is considered average in the market, the average return is around 10% annually on long-term investments.
You can ride it out:
Even when there are sudden drops in the market, the stock can rise again. This is why it’s advised to own stocks, long-term. Experts can tell you that previous behavior of the market shows that long term investments have the ability to take on the risk. While the prices of individual stocks can rise and fall daily, the market itself can rise in value.
Diverse Investments:
Generally, some stocks are less risky than others. You might do better with a solid investment in the best railroad stocks, for instance, but a small company also has very strong potential for future growth. Investing in different stocks will help build your wealth by leveraging growth in different sectors of the economy. There are diverse investments in the market that can achieve your goals, as long as you’re able to tolerate the risks.
Accessible to the Public:
Data and research tools have made investment easy and fair for the average investor. Thanks to the internet, data that was once only available to brokerages is now available to other smaller players wishing to invest.
Ownership:
When you invest in a stock, it means you have an ownership stake in the company you invested in. Having this ownership means you may sometimes vote on corporate board members of the company, and other decisions.
Be far-sighted
The market is about tomorrow. Market investment isn’t a get rich scheme. Several other reasons can be added that will show you market investment is the best thing you can do for your future. There are ways to invest that you can study so that you do not suffer large losses. The sooner you invest, the longer the time your money will have the chance to increase.