Understand The Different Kinds of Stocks
Stock means ownership stake of a company that issued by the company for general people. The money is collected from the issued stocks, used for development and project of the company, we can say it is a different kind of investment. Sometimes the company makes profits or loss, these profits provide to the investors in the form of the dividend by the company. Many investors take dividends as the interests of the stock investment. Stocks are available in the two forms which names are "Common" & "Preferred". Investors more wish to Preferred stock, because the benefits of paid dividend provide to the Preferred stock investors before the Common stock investors. Here we are showing subcategories of the Common stocks, shown below
Growth:- Now we are talking the Growth Stock that has the most increasing rate of value to the rest of the market, these facts found by their prior performance history. These stocks used in riskier investment, because these are capable to do manage risk, but they may offer greater potential as rewards at the end of the investment.
Income:- In the case of Income stocks, these are not much varied in value but these have a great history to the other stock, that they provide better paying of dividend, these are available in both categories The Common and Preferred Stocks.
Value:- It has different nature to the rest, these stocks are undervalued by the market, and investors can buy it at the lower price than the underlying price that company would suggest. The main concept behind these stocks, when the market turns to the senses, then an investor would make a lot of money.
Blue chip:- It performs well enough for the long period of time so that they are considered as a reliable and stable investment. Due to its characters, it can't grow rapidly or pay but for the future investment, it is a good choice.
Defensive:- These are the stocks where companies of stocks offer products and services people to buy, here no matter what the company's economy is doing. These stocks include the companies about food and beverage, pharmaceutical and utilities.
Speculative:- It offers companies which are related to the new technologies and older companies with new executive aptitude. They perform looking for something novel or a method to beat the market. The performance of these stocks is particularly impulsive, and they are sometimes measured to be a high-risk deal.