Tips For Investing In Stocks – Which Way to Go

Stocks are all the shares in which ownership of a company is divided. In common English, the stocks are collectively called “stock”. A single share of this stock represents fractional membership of the company in percentage to the amount of shares outstanding. The term’stock’ can also be used for the property referred to in ‘equity’. Some of the most well-known businesses that use stocks are the likes of Apple Computers, Microsoft Corporation, VISA, Union Bank, Enron, Burger King, Daimler-Chrysler, Exxon-Mobile, Philip Morris and Tiffany & Co.


Stocks represent shares or rights to ownership in a company. The ownership is transferred through a sale to an interested shareholder. There are two main types of stocks – common and preferred. Common stocks are listed on the New York Stock Exchange (NYSE) and the NASDQ (national association of securities dealers). Preferred stocks are traded on the New York Stock Exchange (NYSE) and the NASDAQ.

The main difference between public and private stocks is that the latter are exchanged publicly. The price of a stock in the NYSE is determined by a bidding process. A shareholder can buy or sell shares through brokers, through telephone call (interview) services, by Internet purchase, or through a company’s own website. The Internet has created new opportunities for online trading.

A great opportunity to invest in stocks is to invest in penny stocks. These shares represent a low risk investment since they do not carry any legal obligation. They also do not have to register with the United States Securities and Exchange Commission. A good example of penny stocks is the New Lots Company. This company buys up large quantities of penny shares from major companies such as Ford Motor Company and Unilever, a division of Unilever.

Penny stocks also underwrite other types of securities. They make perfect options for investors who wish to buy shares in a company but do not have a lot of money. The reason for this is that most private sales never pay dividend. Instead, they use the money to finance their own start-up. Therefore, you stand a good chance of getting a dividend when buying these stocks.

You stand even greater chance of getting a profit when buying penny stocks when they are owned by large corporations. Investors who own a large amount of these stocks will benefit from the dividends. However, there is a potential risk when investing in these types of stocks. If the corporation becomes bankrupt, you could lose your entire investment. So, be careful when purchasing these types of stocks and do your research before investing.

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