Why you should invest in the stock market ?

                                    

If you have some money saved up, then one question always arises in your mind, “Where should I invest? And there is no better place to invest than the stock market. Whether you are a new investor or a seasoned one, investing in the stock market can give you the highest returns.

The Sensex was launched in 1986 but 1 April 1979 is the base year when the index was set at 100. Since then, the value has shot up dramatically. In the last 40 years, Sensex has gone from 100 to 42273. There have been periods of slow growth to exceptionally high rise, it’s been a roller coaster. But if you start early and invest intelligently, your money can grow tremendously over time.

1) Growing your money over time

The major reason for people investing in stocks is to grow their money. Because of the magic of compounding, your principle sum compounds over time. Warren Buffet is rich not only because of his shrewd mind but because of his old age too. He let his money compound to what it is today.

2) Stock prices have risen over time

Future holds sweet spots for a few industries and if you are able to tap into that industry your invested sum will grow exponentially. FMCG stocks were sold for pennies when they were initially offered, now the same stocks are offered for thousands.

3) Investing is better than saving

Thanks to inflation, the money you have right now would valueless in the future. What costed 10Rs in the past now costs 100Rs.

What that means for you is that your hard-earned money is slowly losing its value over time. Which you would not if you invest this money wisely in the stock market. 

4) Small investment, larger returns

Stocks don’t need a large investment. No matter the amount you have, you can invest it, unlike another form of investments like, real estate, which needs a huge sum of money.

Stock prices can also grow at exponential rates thus giving you huge returns.

5) Liquidity

Unlike other investment options, the stock market is highly liquid in nature. You can take your investments out any moment you deem fit.

6) Save for retirement

For retirements- stocks work as a hedge. You get a fixed amount of dividend per year with these stocks. ITC has a dividend yield of 5-7% which effectively means that for every 100 rupees invested you will get 5 to 7/- each year as a dividend. The increase in prices is a bonus to its price already.