Introduction to shares and stocks 2

Today we will look at certain important parameters on which decisions will be made whether to purchase stocks or not . These parameters help us in understanding the financial viability , the profitability now and over the years ,

Share price :

Share price is the price of a single share . The share price depends on the highest amount of money one is willing to pay for the particular stock . A company will have a number of stocks which they can sell . If there are number of buyers vying to purchase and there are less number of shares being sold , the share its price will go up . 

It varies from moment to moment , day to day and over years . It can go up or down depending on company's health . It should appreciate for you to make profit . You will lose money , if the price of the share is less than its price when you purchased the stock . 

For example say you have purchased an ITC share for Rs 250 three months ago and today its value is Rs 360 . Then on each share you made a profit of Rs110/-If you purchased 100 shares ,you make a profit of  Rs 11000/- . The share price is published every day in news papers . you can get the price of the share at any given moment online . You can purchase or sell a share instantaneously online . 

The appreciation or depreciation of stock price depends on many factors . If you understand these factors , you make money . The prediction of share movements is both a science and art . There are few people who always make money in shares .However there are many others who lose money as their predictions and calculations go wrong . The share movements depend on certain statistics . No doubt intuitiveness and observation of market plays a large role in making profits from market .  

There are many stories of persons who kept their money in a stock for years and almost forgot about them . The stock price has shot up several times over years and they have become millionaires without any effort . To identify such a company which will do well in future is the dream of all investors .

Then there are persons who invest in shares to get regular income in the form of dividends . 15% to @20% returns per year are normal if one invests wisely . Remember there are risks involved in shares .