COMMON SENSE INVESTING
todays financial news is replete with alternation- getting headlines of kind - big swings in stock prices , program trading, large corporate mergers ,
to those who do not follow the day today heppenings in the market , it appears confusing and intimidating , it sounds complicated , so , many would be investors become discourged .
ACTUALLY , for most , investing in the stock market can be a simple process , it can e educateional chalenging , and with a little patience , very rewarding

it would be wrong to say that successful investing is only a matter of common sense , it also involves some effort but many rewarding invesments have been identified by applying vcocommon sense it alsense to personal knowledgw and experiences and using each obsercation as a starting point




WHY DO PEOPLE BUY STOCKS?
where should that extra money go?
into the bank? bonds ? real estate ? art ? oir will the stock market provide the best possible return ?
while each individual has adifferent investement objective
stocks are brought for one ot many reason :
TO MAKE MONEY!!
an individual can participate in the stock market in three ways:

INVESTING

this is generally the most successful aproach because time can be used to an advantage
an investor buys shares to be a part owner of the company
and to obtain at least an adequate return on the investemnt

SPECULATING

the speculators is willing to assume great risk for a potenially great reward , being a part owner is not important to the speculator , since the time horison is to be no longer than necessary

TRADING

a trader attempts to take advantagee od small price , changes, and is less interested in value
stock certificates are merely pieces of paper to be bought or sold for a profit within a short perion of time - some times days or hours


whether investing , speculationg , or trading ,
a stock holder makes money by receiving cash dividends ( ussually paid quarterly )
from the company and/ ir by obtaining capital appreciation if the stock is sold at a higher price than the original
price of purchase
each day the stockholder can calculate the theoritical profit or loss on a piece of paper ( paper prfit , paper ;loss)
but the profit or loss is not as they say , realized untill the stock is actually sold