Basics of Stocks
Sep 17, 2023
Myths about stock markets
- Investing is just like gambling.
- Eventually, one day the market will crash and you will lose all your gains as well as the principal amount.
Source: Google Finance
Source: Google Finance
Source: Google Finance
Source: Google Finance
High risk equates to high profits.
Only meant for “experts” with “large” capital.
Stock that have skyrocketed must go down.
Source: Google Finance
Source: Google Finance
Until some serious bad news arrives.
Source: Google Finance
- Stocks that plummet must go up.
Source: Google Finance
Source: Google Finance
Dividend
A dividend is a distribution of profits by a corporation to its shareholders.[1] When a corporation earns a profit or surplus, it is able to pay a proportion of the profit as a dividend to shareholders. Any amount not distributed is taken to be re-invested in the business (called retained earnings).^1
Interest vs Dividend
| Interest | Dividend |
|---|---|
| Mandatory | Optional |
| Taxable | Taxable |
| Calculated on principal amount | Calculated on face-value |
Circuit Order
Upper circuit: Nobody is selling
Lower circuit: Nobody is buying
TL;DR
Source: r/IndianStreetBets