Finance - Shares & Stock Picking

Shares & Stock Picking

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Direct share purchases can be made via a bank or stockbroker. These give the investors certain rights and a share of the company's profit, paid out in the form of a dividend. In theory, as the company grows and increases its profitability, share values rise and offer the investor a potential capital gain.

Shares are classed as higher risk investments: the reward in terms of the dividend and capital growth can be significantly greater than cash but the capacity for loss is also significantly greater.

When stock picking, blue chip shares should be considered, as they are regarded to be the more financially sound among the public limited companies, which are listed on the international world markets.