Stocks as a key tool for your financial future
For many new investors, the stock market can feel a little intimidating or like a world away. But guess what? Getting a handle on what stocks are and how they work is the absolute best way to start taking charge of your financial journey! This article is here to clear up any confusion and set the record straight, giving you the basic fundamentals of stocks in a super simple, easy-to-digest way. That way, you’ll feel totally confident when looking at investment options for your personal strategy.
What is a stock in simple terms?
A stock (or share) is a small fraction of the ownership of a company. When you purchase a stock, you become a co-owner of that company, and your share represents a claim to a portion of its assets and earnings. Stocks are bought and sold on specialized platforms and systems where these assets are traded.
Types of stocks
There are mainly two types of stocks that an investor should consider:
- Growth stocks: These are shares of companies expected to grow faster than the market average. They generally reinvest their profits for expansion, so they often do not pay dividends. An investor who buys these stocks seeks long-term gains through appreciation in value.
- Value stocks: These are shares of companies considered undervalued by the market. They may be established, financially stable companies that often pay dividends (a share of the company’s profits distributed to shareholders). Investors who choose these stocks look for a steady income stream and potential value appreciation over time.
How to make money with stocks
You can potentially make money with stocks by accessing investment services for solid companies. When you acquire a share of a company, you become a co-owner, and that’s powerful. When the company performs well and its value grows, your investment grows with it. This is how you can pursue a more solid financial future, simply by owning a piece of a great company.
The importance of stocks in a diversified portfolio
Stocks are a fundamental component of a strong diversification strategy. By adding shares from different sectors and companies to your portfolio, you can balance risk. If one asset underperforms, another could potentially offset the loss.
Stocks give you simple access to global markets. Through the Bitso app, you can access advisory and investment services for global stocks and gain a powerful tool for diversification.
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Services offered by the independent investment advisor The Badger Management House Independiente, registered under folio 30205-001-(16900)-22/07/2025. The CNBV exclusively supervises advisory and securities investment services. Consult more details at The Badger Management House
