BENEFITS OF INVESTING IN SHARES 1

There are so many reasons why you should invest in the capital market .I will explain them below.

DIVIDEND
This is a slice of the profit that is made by a company.This profit is shared among the owners of the company at the end of every financial year.Dividends are given according to the number of shares an investor has in the company.

BONUS ISSUES
These are shares that are given free of charge to shareholders,according to the proportion of ownership in the company.Bonus issues rank equally in all respects with existing shares of the company.This increases the number of shares an investor has in the company.
The way to profit from bonus issues given by companies is to buy shares of companies, whose management give out bonus issues regularly.For instance,an investor who bought 10,000 units of Union bank shares in 2003 now has 25,073 units shares in the company.This is because Union bank gave a bonus of 1 for 3 , for three consecutive years,and a bonus of 1 for 10 in 2006.

CAPITAL APPRECIATION
One of the major reasons why you should invest in the capital market is, capital appreciation.A stock is said to appreciate,when the price is above the purchase cost.The Nigerian stock exchange offers superb capital appreciation prospects.For instance, an investor who bought 100,000naira worth of Zenith bank shares now has investment worth over 450,000naira in the company.This is because the stock has appreciated by over 3000%.
The key to making money through capital appreciation is to buy stocks that have growth prospects.By this I mean you should buy low and sell high.I will discuss this in greater detail later.