FAQ on Stocks

What kind of returns does one get from stocks?

Stocks give two types of returns � returns from dividends and returns from increase in stock prices. Dividends are declares whenever there is distributable surplus available and when the board of directors of the company decides to declare dividends. Stock prices tend to go up and down depending on demand and supply for such stock based on expectations of future performance by the company. If the expectations of future performance are high then demand for the stock increases and so will prices, as the supply of stock is fixed of limited. When expectations of future performance of the company are low then demand for the stock decreases and so will prices. A person can get returns by buying stocks when prices are low and selling them when prices are high.
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