Highlights: 1. Market to be choppy. 2. Book profit at regular intervals.
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Why should one invest in equities in particular?
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1. INVESTMENT BASICS
2. SECURITIES
3. PRIMARY MARKET
4. SECONDARY MARKET
4.1 INTRODUCTION
4.1.1 Stock Exchange
4.1.2 Stock Trading
4.2 PRODUCTS IN THE SECONDARY MARKETS
4.2.1 Equity Investment
4.2.2. Debt Investment
5. DERIVATIVES
6. DEPOSITORY
7. MUTUAL FUNDS
8. MISCELLANEOUS
9. CONCEPTS & MODES OF ANALYSIS
10. RATIO ANALYSIS |
When you buy a share of a company you become a shareholder in that
company. Shares are also known as Equities. Equities have the potential to
increase in value over time. It also provides your portfolio with the growth
necessary to reach your long term investment goals. Research studies have
proved that the equities have outperformed most other forms of
investments in the long term. This may be illustrated with the help of
following examples:
a) Over a 15 year period between 1990 to 2005, Nifty has given an
annualised return of 17%.
b) Mr. Raju invests in Nifty on January 1, 2000 (index value 1592.90).
The Nifty value as of end December 2005 was 2836.55. Holding this
investment over this period Jan 2000 to Dec 2005 he gets a return of
78.07%. Investment in shares of ONGC Ltd for the same period
gave a return of 465.86%, SBI 301.17% and Reliance 281.42%.
Therefore,
- Equities are considered the most challenging and the rewarding,
when compared to other investment options.
- Research studies have proved that investme nts in some shares with
a longer tenure of investment have yielded far superior returns than
any other investment.
However, this does not mean all equity investments would guarantee similar
high returns. Equities are high risk investments. One needs to study them
carefully before investing.
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