Investing in stocks is one type of investment that can be said to be tempting for friends who have a risk-taking investment profile. Stock investment is categorized as a high-risk investment, although the yields can be higher and faster than other types of investment. However, every type of investment must have its pluses and minuses, including stock investment.
If you want to invest in stocks, besides having a risk-taking profile, you also need to have basic knowledge about investing, especially investing in the stock market. If you already have this provision, the potential to enjoy its benefits is wide open.
To be able to enjoy the benefits of stock investing, let’s first identify the pluses and minuses of successful stock investments. Akseleran summarizes the following:
Plus Stock Investments
- Potential high returns.
The fluctuating movement of stocks can be an opportunity for the price to continue to rise, but usually this follows global and domestic sentiment. But it could also be technical. Thus, if you get a positive sentiment, the stocks you have can quickly go up and you can sell so you get fast and high returns.
- Get dividends
Dividends are the profits generated by the company and you as an investor are entitled to receive these dividends. Dividends are divided based on the shares you have, so the more you invest in the company, the more dividends you will pocket. However, the distribution and amount of dividends to be distributed must be approved by the General Meeting of Shareholders (GMS) first, because it could be that the profits will be used for company development.
- Can be done anywhere
In the online era, including stock investing, you don’t have to bother coming to the Indonesia Stock Exchange (IDX) to buy shares or monitor the movement of your shares there. In fact, now there are investment applications that can be downloaded on your cellphone and can make transactions wherever you are.
- Follow the rate of inflation
Stock investment does not need to worry that your investment will be eroded by inflation. Because stocks usually move according to the inflation rate. Especially if you choose a type of stock that is not affected by inflation, for example property stocks.
Minus of Stock Investment
- Time is not flexible because you have to frequently see stock price movements. Stock
investment, although it can be done anywhere, needs to be monitored at any time. Given the fluctuating moving stock prices. Then the price may go up or down in a short time, if you don’t monitor it, you can miss that moment. If it goes down, it will lose if it goes up, then the profit will be thin.
- High risk due to fluctuating stock movements.
In contrast to high yields, you can also experience a high risk where the stock price that you bought previously fell lower. This is often due to the loss of business activities of the company or the wrong strategy.
- Having potential loss when the company is declared bankrupt.
A bankrupt company is a nightmare for investors because they will lose all their invested funds. When a company goes out of business, shareholders will be the last factor to receive compensation, because the company will prioritize debt payments and employee salaries first.
- Not getting dividends.
The opposite of plus investment in stocks. Because not all companies pay dividends. If you want to get dividends, you should first find out which company is paying dividends before buying shares.
Friend, that’s the plus and minus of investing in stocks, hopefully you can provide more knowledge if you want to diversify more funds.