Investing in stocks is both fun and profitable but you must know your investing options as well as be diversified.
No matter what your financial goals are or what your current age is it always helps to understand your stock investments.
1. Growth Stocks – Many small and mediums companies are considered growth stocks since they are growing rapidly. These companies also reinvest their profits back into their own companies to continue their growth. You can find out more information Click Here!.
2. Blue Chip Stocks – Many of the large well known companies are known as blue chip stocks since they have steady earnings and pay out part of their earnings in the form of dividends.
3. Income Stocks – Many of the larger oil, real estate, and utility companies pay out the majority of their earnings in the form of dividends to shareholders. The shareholder can choose to reinvest the dividends back into additional shares or recieve the dividends in cash.
4. Penny Stocks – Many very small companies trade on the nasdaq and the pink sheets market and are classified as penny stocks since they trade for less than $5/share. Many trade for less than 1 cent and buying thousands of shares can be profitable but risky. You can learn how to trade penny stocks HERE.
5. Options – A even more aggressive and leveraged option is trading stock options. An option represents 100 shares of a stock and can be bought many times for a small percentage of their actual share price. You can learn more about trading stock options HERE.
6. Commodities – The riskiest of stock trading is commodity contracts which are not only highly leveraged but risky. While you can make the most money using commodities you can also lose the most money trading them. If you want more information on commodity trading Click Here!
7. Daytrading – Trading stocks of various sizes and buying and selling them daily is called daytrading. It takes special information which can be found Click Here! in order to make a large income from daytrading.
All of these versions of investing in stocks can work no matter what your risk tolerance and financial goals are. The main key to creating stock wealth is to diversify into multiple types of stocks and investments.