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Stocks
What they are
- Stock represents ownership of
a corporation. Stockholders own
a share of the company and are
entitled to a share of the profits
as well as a vote in how the company
is run.
How earnings
are made
- Company profits may be divided
among shareholders in the form
of dividends. Dividends are usually
paid quarterly. Larger profits
can be made through an increase
in the value of the stock on the
open market.
Advantages
- If the market value goes up,
the gain can be considerable.
- Money is easily accessible.
Disadvantages
- If market value goes down, the
loss can be considerable.
- Selecting and managing stock
often requires study and the help
of a good brokerage firm.
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