Tue 10th Nov 2009, 00:57
Buying stock into a business?
Hello i was wondering if somebody could give me some info on stocks as i have not really dealt with them before.Anyway i may have a chance to buy stock into a large and pretty solid corporation.Anyway i was wondering how exactly it works?I wish it were as easy as buying a percentage and gettin paid out accordingly but with shares i'm not sure how many shares there are and how everything works.Aybody who is pretty good in this area please let me know or any questions i can anser as i know i haven't been too detailed
Last edited by bloop; Tue 10th Nov 2009 at 01:25.
Tue 10th Nov 2009, 09:40
bloop are you considering buying stock in a publicly quoted company? Have you received independent financial advice? What country are you based in?
Tue 10th Nov 2009, 10:36
I think Fergal covers the initial questions. If you are thinking of purchasing stock you need to plan it carefully.
1. How risky can you afford to be? i.e. would you be ok if you lost your money.
2. Are you in it for the short or long term? A stable company may not get you high growth over a short space of time, but is more likely to give you something over a longer period.
3. Can you or do you know of a good adviser for stock? if not, find one and check out some references.
Tue 10th Nov 2009, 20:49
well i was def goin to seek advice from a professional but wanted to just try and figure out the basics before i dedicate too much time to it..
1.yes i can risk it
2.i'm in it for long term but i'm tryin to figure out how exactly everything works
for instance a share of the company is about .70 cents right now.The market cap is about 12.3 mil...how many shares does the company have and let's say i buy 5% of the shares how would i get paid.Let's say they make 1 million in 1 year would i get 5% of that or would the stock just go up for me to sell my shares at a higher dollar amount?
The reason i'm asking is i want to just pretty much own a percentage of the company and get paid out according to what they profit.I don't want to be buying and selling shares to make my money and i am pretty clueless in the stock market
thanks for the advice guys and hope u can help me a little more
Wed 11th Nov 2009, 10:38
Hi bloop, I'd suggest that you learn a little more about how the stock exchange works before you make any significant investment. A shareholder in a company doesn't automatically get paid a portion of the company's profits. The company may decide to retain or reinvest their profits and if they do that you will not receive payment. Shareholders receive payments by way of dividends, but the company can decide not to pay these dividends.
If the company is profitable the value of the shares will often go up, but this increase in share price is not guaranteed. If the market foresees that the company could face a difficult future the share value of the company could fall, even if the company is profitable and not paying dividends.
Have you spoken to your local bank to ask if they provide brokerage services?
My understanding is that if "a share of the company is about .70 cents right now.The market cap is about 12.3 mil" then there are about 17.57 Million shares issued (i.e. 12.3M / 0.70).
You could have a look at Wikipedia to start gaining a basic understanding of how the stock exchange works, these articles might be useful to you;
Stock Market Prediction
You will note that those articles contain lots of links to other useful sources of information. You should also note that information on Wikipedia is not guaranteed to be 100% accurate and it can contain inaccuracies. However, the articles should give you a basic understanding of stock and share trading works.
It also helps to read the business section of your more reputable national newspapers or Financial Times.
Good luck with it and please keep us posted on your progress.
Wed 18th Nov 2009, 04:35
I am thinking of bonds and stock too. I hope it's not that risky to invest in this type of business.
Wed 18th Nov 2009, 10:59
I deal with stock on a regular basis, being as I sell quite alot of items on ebay. I suggest you should start off with a few of each items that you are wanting to sell but if you are confident then get alot of that certain item, if you believe you can sell it for the right price.
Make sure you dont end up with dead stock.
Research the market place that you are going into fully, For example: My items I was wanting to sell was to do with ipods. I looked around the apple store and other electronic stores to find out what they sell and for what price.
Ofcourse that is just an example and it will differ, depending on the type of product you are aiming to sell.
I wish you all the luck and if you require anymore help, im your man
Thu 19th Nov 2009, 07:55
I would suggest you to meet good stock agencies who can give good suggestions and scripts to buy.
Mon 23rd Nov 2009, 15:43
Are we talking about stock or goods? Seems like the discussion went off track. Fergal is absolutely correct, you need professional advice before making a move like that. There are many things to consider.