2.2. The Intricacies of the Stock Market
The stock market is not the grand mystery that most people believe it to
be. One does not need an intense education or a vast knowledge of financial
jargon to be successful in investing. With careful consideration and smart
decisions, an average person can become quite wealthy over a period of time.
The most basic tenet behind all dealings with the stock market is to buy
low and sell high. The price of stock in every company fluctuates daily and when
an investor buys stock at a low price and sells it at a high price, a profit can be
made.
Predicting trends is the most valued skill when it comes to investment. It
takes a substantial amount of time to research and predict the trends of a stock
and invest accordingly. Even with careful observation, prediction is not an exact
science and is the major cause of the risks involved in investing. A person can
individually decide to invest based entirely on their own research and intuition
and, often, this can be profitable. For those that are less than confident in their
own ability to predict trends and read into the market’s signals, there are
companies that specialize in just that. Stock brokerages provide advice and
other assistance to those willing to pay for their services. Financial advisors are
especially handy to an investor that does not have the time to pay close attention
to the market but still wishes to take advantage of its potential for profit.