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Benefits of investment in shares
Investing has numerous advantages. Let's look at how this common type of investment can be a profitable way to make money. Here are some of the advantages of investing in stocks.
1. Capital growth
Capital Gain occurs when you sell a share for more than you paid for it. This occurs when an individual witnesses a significant increase in share prices and is one of the long-term goals of investing in stocks.
2. Dividends
A dividend is a cash payment made to shareholders as part of the company's profit at the end of each fiscal year. The more units of shareholdings one owns, the more money one receives.
3. Liquidity
By definition, listed shares are a very liquid product that can be bought and sold quickly on an exchange platform. There is no need to involve a broker or transferee, and the cost is relatively low when compared to other financial products. Trading on an exchange also allows you to sell a portion of your share parcels rather than the entire lot.
4. Shareholder benefits
Some publicly traded companies in various market sectors, such as entertainment, retail, hospitality, and financial services, provide lavish discounts to shareholders when they purchase goods or services from the companies or their affiliates. However, in most cases, a large number of shares are required to qualify for such benefits.
Investing in shares, or stocks, offers numerous benefits for individuals seeking long-term wealth growth and financial security. Firstly, shares provide the opportunity for capital appreciation as the value of the underlying company increases over time. Dividend payments, a share of the company's profits distributed to shareholders, offer a regular income stream, enhancing the overall return on investment.

Shares also provide liquidity, allowing investors to buy or sell them relatively quickly on the stock market. Investing in a diversified portfolio of shares helps spread risk and reduces vulnerability to the performance of a single company or sector. Furthermore, shareholders often have voting rights, enabling them to participate in corporate decisions and governance.

Overall, investing in shares can play a crucial role in building wealth, generating income, and participating in the growth of the broader economy. However, investors need to conduct thorough research and consider their risk tolerance before engaging in the stock market.

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