Tips on Share Market investment.

This response to the title "Share Market" is on a presumption that it refers to the Stock Market which is more appropriately called. It is on this basis that I will provide some information and tips. The stock market is involved in selling and buying shares of stocks of publicly listed companies. Meaning the common people can buy and own shares of stocks but not enough to be called a major stockholder. I have "played" in the market for about 4 years in our country and did several trades every week. There are blue -chip shares of stocks and these are mostly of stable and well-known companies. People who invest in blue-chips are looking at the Return On Investments (ROI). This narrates to big dividends, cash or stock, or both. A substantial amount of money is involved for equally substantial dividends paid out in regular intervals. When business and economy is good, the share prices could also increase largely within a short period. If business is bad, share prices would not dive as low as non-blue-chip shares. Investors in blue-chip shares can afford to leave their investment in those stocks for a long time. The stock certificates they hold are very liquid, meaning it could be traded easily in a short period should there be a need for immediate cash. Some financial institutions even accept them as collaterals for loans.

For the stocks not considered as blue-chip, are those that are traded almost daily. This happens because of speculations that the price might go down for others, on the other hand, those who buy try to buy low in speculation of a sudden increase in a very near future. With these kinds of shares traded and change hand almost everyday, are not issued stock certificates. They are termed as shares of stocks with "street certificates". An order and proof of purchase is sufficient to show ownership.

It took me some time to learn what to look for, read and study. It is important to know what business the company is involved in, its rank in the industry, history, size, financial status and the officers of the company. Most stock market trading companies will have this information and brochures for that matter. It is important that you understand, know how to read and analyze the company's financial statements. The assets and liabilities are important to know what the company owns and owes. How much their expenses are and how they spend it. It will also show the companys earnings/profit after deducting costs, expenses, depreciation and taxes from their Gross Income. Good transparency of a company is a favorable characteristic. Basically, it is the reflection on how good the business is and how the people run the company. Buying and selling of shares will therefore really depend on your understanding and gut feeling. Anticipation should be used if you are aware of business ongoings while speculation could be used when there is a particular trend in the market. There are no guarantees in this kind of trading.

Beware though of "enhanced" financial statements like that of Enron, as an example. Some stock market rumors are reliable, but beware of insider trading. Insider traders could cause the price to go down so they can buy as many as they can, knowing it will go up in the very near future. Or, it could be otherwise. They could make a rumor that prices would go up so they could unload the shares they own because the company will be in the "red" within a short period.

As the acronym represents, it means the first time shares of stocks of a company to be traded on the floor. Most of the time IPOs give good profits for investors. The common reason behind this is the company has been in good business for quite some time (like Google for example), or, a new company that will go into a very promising business, like say, alternative fuel at a much lower cost. Before being actually traded on the floor, shares could have already been subscribed to, prior to the IPO (there is a term for that I just can't recall). If you are a client close to a stock market trader, chances are you will be one of the few offered for a limited number of shares prior to the IPO.

Trading in the stock market has so many ins and outs. It will probably take to write a book about it. There were some people who really made a fortune out it and some who really got "burned". As for myself, I did get some good profits but not enough to become rich.