How Profitable Is Stock Investing?

By www.ProfitableInvestingTips.com

http://profitableinvestingtips.com/profitable-investing-tips/how-profitable-is-stock-
investing
If you are looking to put some money
away for a rainy day or save for
retirement it would be nice to have
that money work for you as well.

investing
The stock market is often touted as
the best place to put your money and
have it earn a profit.

investing
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investing
But just how profitable is stock
investing?

investing
In the stock market quality begets
profits over the long term.

investing
This is the world of buy and hold
investing.

investing
In the short term research into
specific stocks can lead to tidy profits
which you often will want to take back
out and turn into cash.

investing
This is the world of buying low and
selling high.

investing
In regard to investing in
stocks Investopedia writes about five
stock market myths that can lead
you astray.

investing
The laws of physics do not apply in
the stock market.

investing
There’s no gravitational force to pull
stocks back to even.

investing
Over 20 years ago, Berkshire
Hathaway’s stock price went from
$7,455 to $17,250 per share in a little
more than five years.

investing
Had you thought that this stock was
going to return to its lower initial
position, you would have missed out
on the subsequent rise to $170,000
per share over the years.

investing
We’re not trying to tell you that stocks
never undergo a correction.

investing
The point is that the stock price is a
reflection of the company.

investing
If you find a great firm run by
excellent managers, there is no
reason the stock won’t keep on going
up.

investing
How profitable is stock
investing?

investing
If you had purchased 100 shares of
Microsoft at $21 a share in 1986
when it went public your $2,100
investment would have turned into
28,800 shares after stock splits, be
worth three quarters of a million
dollars and be paying $41,472 in
dividends each year.

investing
If you had bought one “A” share of
Berkshire Hathaway in 1990 it would
have cost you $7,100. Today it would
be worth $224,000.

investing
There are other examples of
investment “home runs.”

investing
In general strong, well positioned and
well managed companies continue to
make money and grow year after
year.

investing
However, there comes a time when
their market is saturated and profits
plateau.

investing
That is why getting into these stocks
when they are new and cheap or are
cheap due to temporary economic
factors is a good way to see the best
profits.

investing
This is the world intrinsic stock
value.

investing
In the aftermath of the stock market
crash of 1929 in the early days of the
Great Depression Benjamin Graham
introduced the concept of value
investing.

investing
No longer would those buying and
selling stocks need to act like they
were at the casino.

investing
With the concepts of intrinsic value
and margin of safety Graham taught
investors a rational means of
investing in stocks.

investing
Read the article for the formula. The
point is that you can find and
purchase stocks that are selling
below their value to you as an
investor.

investing
These stocks will make money over
the years.

investing
Their stock prices will rise as the
market catches on.

investing
And many will be or
become dividend stocks that
provide you with a nice quarterly cash
payment.

How Profitable Is Stock Investing?

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How Profitable Is Stock Investing?