Still feel uncertain about investing? Here are some commonly asked questions and answers. Hope this helps!
1. What is considered to be a good return rate on investments?
Many people are unsure of what they should be expecting from their investments and what a good return rate really looks like. The easiest way to determine whether your investments are doing well is to look at the history of the company you’re invested in as well as comparing it to other companies’ performance.
2. What is the rule of thumb when it comes to investing?
When it comes to investing there is a major rule that should be remembered and also never violated if you want to reap the rewards of your investments. The number one rule that everyone should follow is that you should never invest money which you do not have!
3. What does deflation mean to investors?
Deflation is the macroeconomic impact on a country where the lowering of prices are experienced. This is directly the opposite of inflation where consumers will experience a rise in the cost of living. Deflation is not something that is welcomed but you would be forgiven if you thought that lower prices would be wonderful. deflation means that the prices of everything dramatically drops and when it drags on too long, companies’ profits begin to drop. Economic circumstances then force the companies to sell their products for even cheaper, and consequently have to cut back on labor and production costs or even close down production facilities. The result of this is that unemployment rises, the economy cannot expand and people aren’t spending their money because the future seems unclear. When people aren’t spending their money, companies aren’t’ making profit therefore their value decreases and nobody wants to buy shares.
4. Why do stock prices fluctuate?
Stock prices fluctuate because of supply and demand.