Introduction to Investment fundamentals, Investing in Stock Markets Video

when you work a job you're basically
exchanging time for money the more hours
you work the more money you make it's a
good way to get by but a bad way to
build wealth because eventually you
simply run out of hours that's why if
you want to grow wealth quickly you need
to make your money work for you how by
investing and trading in the financial
markets okay so think of the financial
markets as a garden where you grow well
just like you plant a seed and watch it
grow in the financial markets you can
invest a small amount in companies real
estate foreign currencies and other
securities then share in their profits
as they grow in value and thanks to a
financial principle called compound
interest your take becomes bigger and
bigger every year for instance let's say
you invest $1,000 in Company A in the
first year they grow 15% meaning you
make 150 dollars bringing your total to
eleven hundred and fifty dollars then
the next year they grow another 15% but
instead of making 15% on one thousand
dollars you make 15% on your new total
eleven hundred and fifty dollars which
translates into one hundred seventy two
dollars fifty cents for the year and
thirteen hundred $22.50 total do this a
couple more years and you will have
doubled your money without lifting a
finger but if you never invested that
one thousand dollars you wouldn't have
earned anything in fact your money would
have decreased in value due to the
rising cost of living or inflation even
with an inflation rate of 5% that $1000
would have lost a third of its value in
ten years
so clearly investing is the better way
to go but how do you do it without
taking on too much risk first off you
should put enough money into savings and
insurance to protect yourself in the
event of a downturn or adversity second
if you're just starting out you can
focus on regular investing or trading
regular investing allows you to
accumulate wealth in the long run while
trading enables you to capture
consistent short-term gains to grow your
capital quick
provided you understand behavioral
analysis and market timing finally once
you've established a large capital base
you can choose to buy and hold for the
long term to generate capital gains and
passive income or use long term trading
strategies to manage your portfolio
effectively but those are just the
basics
there are many instruments for trading
and investing and in order to grow
wealth on the market you'll need to
understand how they work so next let's
take a closer look at one of the most
common types of investments stocks
you