Top 10 Benefits of Investing in Stock Market
Equity is an asset class that can amaze you with the wealth creation and other advantages it provides in the Long-Run. These are opportunities that one cannot miss in order to get handsome returns as well as wealth creation.
There are many benefits that Equities offer, below are top 10 benefits that make Ordinary Shares/stocks, a class apart investment are as follows:
- Diversification: Purchasing stocks of companies operating in different sectors as well as segments is possible, which helps in optimising the asset-allocation and provides diversification.
- Protection against inflation: Over the years, ordinary shares are said to have won the battle against inflation rate providing enough returns and growth
- Great Post Tax Earnings: Tax is another factor eating up gains, investing in ordinary shares helps you maintain the rate of returns on investments.
- Ease of Access: Updates and innovations in technology especially in the area of Fintech is the reason, one gets ease of access to stock markets with considerable reliability. Input a few information asked from you by the exchange and brokerage houses or mutual fund houses, and you are ready to partner India’s growth story within few seconds.
- Invest in smaller amounts: With mutual fund industries picking up in the last decade, now an investment is possible in equities with a very little amount via the Systematic Investment Plan – SIP route of Mutual Funds.
- Partnering in the Nation’s Prosperity: India is an emerging country, growing at a decent pace, with stock markets there exists an opportunity to be a part of India’s growth story and profit from it.
- Value Investing: Equity Markets have the reference of 2 creatures – Bulls and Bears. Bull is when the markets are in uptrend, and Bears is when the markets are in downtrend. Value Investing means buying or holding the stocks at every bear or negative movement and selling at every positive or bull movement and making profits on your investments.
- Well-Regulated and Transparent Framework: Being a part of the global economy, stock markets are well-regulated and transparent to suit everyone’s needs in terms of Valuations, Pricing, Disclosures to ensure that none of the investor is at risk of hidden propaganda anytime, anywhere. As far as India is concerned Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) in association with SEBI provide transparent, well-regulated framework and platform for exchange, trade and investments of stocks.
- Opportunity to invest in markets across the globe: Stock Market gives the opportunity to be a global investor by investing in Shares of companies headquartered overseas being listed on Indian Stock Exchanges, exploit the profit opportunities from the company’s expansion plans and making money for a better standard of living.
- Partnering the Business, You Love: There are certain companies or business houses and sectors which we love to track and at times imagine if we had the opportunity to run that company or business. But being a retail investor with limited financial capacity, that might not be possible. However, we can partner the same business by buying the shares of the company and becoming part owner of the company we love.
Stock markets are a barometer of the economy and if one wants to grow financially along with growing economy, invest in bourses.