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Look. There are many investment vehicles around for you to choose from.

You name it. We have bonds. Real estate. Fixed deposit. Currency (FOREX). Gold. Silver. Commodities. Structured deposit. Money market fund.

All have their pros and cons.

 

 

But we are going with just one as our chief investment choice - stocks.

Here’s why we think stocks are HOT:

 

1. Long Term Returns

Stocks traditionally outperform other investment vehicles such as bonds over a period of time.

Stocks have also historically proven to generate positive returns over the long run.

2. Dividend Income

Dividend income from stocks adds on to our investment gain. Dividends give us more cash for reinvestment.

Or we can simply use it for living expenses. Neat.

3. Liquidity

The stock market is a beehive of activity. For most parts, stocks are highly liquid.

You can put your money in, and then decide when you want to come out.

You decide today is the day you want to get out, and you can sell it immediately. No problem.

For investments like real estate, it is more tricky, as it is harder to find a buyer.

4. The Astounding Power of Compounding Returns

Picture a small snowball rolling down a snow-capped mountain. As it rolls, it gets bigger as it catches more snow particles.

So the ball rolls and rolls and rolls…..

And it gets bigger…BIGGER…..BIGGER….BIGGER…MONSTER!!!

You get the drift.

The same snowballing effect can happen to stocks.

Imagine you have 10,000 dollars for you to invest.

Assuming you are making a gain of 15% per annum (an achievable target), you will have doubled that amount in 5 years.

In 10 years, your $10,000 will become $40,455.

In 30 years, your $10,000 will become $662,117!

In 40 years time, your initial $10,000 will now be a massive mind-boggling $2,678,635!

Now you are not even counting in the amount of money you will pump in along the way.

If done right, you can be left with a massive beast of a retirement golden egg when you are done.

That is the power of compounding returns. No wonder Albert Einstein calls it the ‘eighth wonder of the world’! How apt!

 

Take Home Message

The morale of the story here is that stocks is a very viable investment vehicle. No doubts about it.

Many have made their millions with stocks through a wise, cautious and calculated approach.

There is no reason why you cannot achieve the same.

Can you be the next Warren Buffett? Probably not. But you are still in with a fighting chance if you start tomorrow, TODAY! 

The key is to invest early. Start young and have a good investment foundation.

And that is what StocksForGrads.com is here for. To be there for you in your investment journey all the way…

 

Play It Smart,

StocksForGrads.com

 

 

 

This article is available as a PDF Download

“Ignore Stocks If You Don’t Want To Grow Your Wealth” PDF Download

 

tag:Compounding effect Investing Basics Stocks Stocks Investment StocksForGrads Warren Buffett

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