Shares for sale in South Africa from the likes of Sasol, Vodacom, MTN and other companies that list on the JSE are popular to buy among investors. Some people find it surprising to know that you do not have to be a wealthy investor to buy and trade the best shares. Because many beginners start with as little as R5000,00. The key when you start out in the world of investments and buying into companies is to begin small. Invest wisely and make sure that you can stay the distance. Follow this advice and you are likely to succeed.
How to Buy the Best Shares for Sale
- Choose your type of investment
- Understand the risks
- Learn about the companies
- Watch the share prices
- Invest in more than one company
There are of course risks to buying shares for sale in South Africa and trading whether it be online or elsewhere. However if you can go the distance then you should comfortably see inflation beating returns over a period of time.
On the other hand it is important to understand the reality that companies do fail. Therefore prices can drop suddenly and drastically as well as increase. As long as you are well enough educated as a beginner investor then you shouldn’t be in for any nasty surprises or shocks when buying, selling and trading on the markets.
This might also interest you: 10 of the Best Money Market Funds in SA
Choose your type of Investment
No two investments are the same. So you need to decide what you want to get out of your capital.
Are you looking to grow your capital with shares which have increasing prices?
Or are you looking for shares which will pay high dividends and create an income for yourself? Essentially, the choice you have to make is between growth and income.
Growth of share prices is caused by a variety of factors. However the price of shares can plummet just as quickly as they rise.
For example a company could introduce new products, technologies and services that cause excitement and cause the share price to increase. But if the technology goes wrong the share price can quickly decline.
To work out the income offered by the share you need to conduct significant research into the terms of the agreement.
Understand the Risks of Shares for Sale
There is no such thing as a risk-free investment or a sure-fire winner.
The prices of shares and the income generated from them can go up, but can also go down. The past performance of the shares is not always a good indicator of future performance.
So all investments should be approached with this knowledge in mind. That being said, investing in shares can be very rewarding and the greater the risk often means the greater the reward.
Before you buy shares for sale, you need to choose the level of risk that you are comfortable with. Would you prefer shares with lees risk and lower returns. Or higher risk investments that have the potential of providing higher returns?
Learn about the Companies
Companies listed on the stock market make their money from a range of business practices, both retail and service related.
Make sure you know how the company you invest in makes its money. So you can see if the sector is performing well in general.
Consider visiting a local branch of the company to find out more about them and how they are doing. The more informed you are, the better your ability to make wise investment decisions.
As a share-holder, you are actually a part owner of the company. This means you need to know who and what you are trusting with your money.
You can review the company’s annual report to see if you like what they say. And see how the business has performed in the past and where it is going in the future. These days you can often access these reports online.
It is also worth keeping an eye on the company directors’ dealings. If they’re buying shares in the company it’s a good sign that the company is doing well. However if they’re selling shares this shows a lack of confidence in where the business is going.
Watch the Share Prices
Keep yourself up to date on the company’s financial indicators as well as the general market performance.
Make sure you know which sector the company is in so you can check up on it.
Look for changes in the share price and the share percentage price change.
Invest in more than one Company
Investing in a range of companies helps to reduce the level of risk you put yourself at.
Because if you put all your money into one company that goes bust, there goes all your money! If you diversify into different sectors you also reduce your overall risk.
At the same time, it’s best not to invest too little into too many companies. The best thing to do is to choose sectors that are doing well. Then invest your money in shares of successful companies in these sectors.
NOTE: Be careful what savings you use to trade with as well. Never use your life savings or pension money in an effort to gain more, that is un-wise. A mistake many have made and could contribute to ruining your life.
To Summarize Shares for Sale
In summary your money is important to you. So tips for buying the best shares can help you make wise investment decisions. Therefore follow the advice above to help you buy shares that best suit your needs. And will offer you the best possible returns.
There are lists of companies on the JSE worth having a look at to help you determine which corporations are offering shares for sale in South Africa.