Why do you buy shares?

What kind of question is that? Do we not all buy for the same reason to make money? Yes and No.

There are different reasons for buying shares. Most people buy because everyone else is buying. (And they sell when everyone else is selling, profit or loss notwithstanding).

Others buy simply to learn how the stock market works. Some buy because they like a company and want to be a part of that company. Others want to have a share of the profit of the company they generously patronize.

Some people buy shares with the money they don’t have an immediate use for. Some others buy to keep their money safe from inflation. Others buy to enjoy capital gains. Still others buy for the generous dividends that some companies pay.

The first question is not “how much do you have?” and not “Which companies do you want to buy?” These questions will come later.

The principal question is “Why do you want to buy shares?”

If you have not answered this question, you are not on course.

Order your copy of my book In The Long Run on Konga or Amazon.

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Image by Ahmad Ardity from Pixabay