8 Facts that Prove the Importance of Stock Investing

1. 8 Facts that Prove the Importance of Stock Investing If you’re a salaried individual in the early or middle stages of your career, there are chances that you’ve heard about investing in the stock market. Depending on your context, hearsay can be varied – that stock markets can make one very rich, or that the stock market is like gambling and you can end up losing all your money if you’re not exceptionally careful about where you invest. As with most things, there’s a hint of truth in both these statements – but they’re far from providing an average individual with a clear picture of stock investing as a whole. In this article, we’ll explore the undoubted importance of investing in the stock market, including covering some important bases such as who should and should not be investing in the stock market, and some common assumptions as well. To do this, we’ll first discuss the fact as it is, and then qualify it with further explanations, thereby providing critical context to the fact. So why is it important to invest in the stock market? Let’s get started. 1. You can beat inflation. This is perhaps one of the best reasons to invest your money in stocks, as opposed to letting it rest in your savings account. Even as the world experiences record high inflation across the globe, the stock market has

2. provided stable returns for millions across the globe. By investing in the stock market, you can make sure that your money does not lose buying power as you grow old, and continue to enjoy as much financial freedom as you do today! Do you know how Inflation Impacts Different Asset Classes? Check it out in our article on the TejiMandi blog. 2. You can have a voice as an investor. When you invest in the stock of a certain company, you become a literal stakeholder of that organization. This means that you will be notified whenever there is an important decision that all the stakeholders need to weigh in on, and you will get to use your voice! Depending upon how many stocks you have, your decision may have differential weightage, but at the end of the day, you will get a chance to influence the functioning of another company – and what can be more gratifying than that? In addition to this, you also get to support certain companies that you believe in. A lot of stock market investors today think about space that are yet to fully develop. They choose to invest in companies that can use their capital to execute their plans, and thus investors can exercise their voice by backing a company’s vision and mission with their wallet. 3. You can get high returns compared to other forms of investment. While the possibility of high returns is always subjective, since it depends on the individual stocks that an investor chooses, there is a larger basis on which this statement is founded. On an average, the S&P index has returned its investors between 8% to 12%, while the NIFTY 50 index has given its investors an average CAGR of about 14%. If we compare this with some of the more traditional forms of investing, such as Gold, or Real Estate, the overall percentage of returns is significantly higher, especially when looked at over a larger investment time period. Read More About Importance of Stock Investing