Buying shares is a choice of thousands of people. However, it is important to know how to do it and what are the risks involved in making such an investment.
The shares are the parts into which the share capital of a public limited company is divided. These parts are owned by a person, who is called a shareholder, and represent the ownership that the person has in the company, that is, the percentage of the company that belongs to the shareholder.
The action is the most well-known and widespread instrument of the stock market. This is a form of investment that allows a person to participate with their capital in the companies, organizations, banks or governments that issue them.
What are the advantages of shares?
- Through the purchase of shares, the investor becomes the owner of companies that are in the public offering and have authorization to list in a market. In this way, the investor participates in the growth and profits that the different sectors can have when acquiring company shares.
- The shareholder has the right to attend the meetings and participate in the decisions that are made there in proportion to the number of shares that he owns. Generally, each share equals one vote.
- The eventual loss never exceeds the amount that was originally invested when purchasing the shares.
- In the long term, shares allow their investors to receive profits commensurate with the evolution of the economy.
When a person buys or invests in stocks, they are buying the underlying stock itself, trying to hold it for the long term. If the company grows and its value increases, the price of its shares will also rise, and by selling the shares, a profit will be made. But if the company were to lose value, its share price would also fall and the shareholder could suffer losses. Therefore, investing in shares is risky, since it must be taken into account that the investor is exposed to the fluctuations of the companies in their growth or retraction.
Now that we have learned what shares are, we ask ourselves… how can you buy shares?
To buy shares, the investor must:
- Be the owner of an account, which must be a checking account.
- Have ID and proof of CUIT or CUIL.
- Keep the affidavits of earnings and personal assets up to date.
- Have salary receipts or monotributo records.
- Have a trading and/or settlement agent registered with the National Securities Commission, who will act as an intermediary.
The trading agent, also known as a broker, is authorized to buy and sell shares in the market, so the investor must tell him what and how much to buy or sell and he will do it for a commission. But, before telling you to act for us, we must open a principal account, which is an instrument that allows investors to access mutual funds, and from there, they can start sending you purchase and sale orders to the negotiation agents, who execute the orders of their clients in any of the systems enabled for negotiation.
The usual thing is that the investor connects to the internet and, from the broker’s website , chooses what he wants to buy or sell and executes it through said site.
A shareholder can buy shares at any time of the day if they do so through the web. However, the order will be executed only if the market is open, since if an order is placed out of hours, it will be stored and will only be executed in the first few minutes of the next trading day.
Likewise, there are many banks that have a broker service , that is, the investor can open a securities account with the agent and operate on the stock market from his own bank.
If a person wants to invest in stocks, they should know:
- How much do you want to earn?
- How long do you want to hold the shares in your portfolio?
- How much are you willing to lose?
Therefore, it is important that you also know:
- What is your investor profile, that is, knowing what your risk level is with respect to how your money will behave in an investment context.
- How much money do you have to invest?
- What is your investment objective.
- What are the associated costs, such as commissions for agents, maintenance costs, costs associated with risk, among others.
Being shareholders is not a very complicated task, you just have to have money, experience, strategy and a willingness to take risks. The important thing is not to rush to buy, but to look at charts and value trends to know where to invest.