The Best High Yield Investment Programs
Trading stocks involves purchasing shares at odd dollar
amounts. Most shares are seen at prices like $2.45, $7.74, or
$110.03. Buying shares in bulk at odd dollar prices will add up to
odd dollar figure investments. Dollar-based investing works with
even dollar amounts, unlike traditional stock share prices.
Instead of figuring the cost of shares and paying odd dollar
amounts, the investor is allowed to choose the dollar amount in
even prices with dollar-based investing. So instead of paying the
price of multiple shares at odd amounts, the investor can choose
investments like $50, $100, or $200 a month.
This is appealing for investors who want to put a set amount to
the side to invest in stocks every month. The amount the investor
pays in doesn't necessarily buy an exact number of shares because
they are in odd dollar amounts. However, the money being invested
that is left over is used to buy more shares the next month. This
process builds an extra amount of
investment that makes a huge difference in the long run.
Dollar-based investing lets individuals who cannot afford full
share prices as well. However, in order to buy partial shares the
investor will need to set up a share building account. These
accounts allow investors to build their investments over time.
Partial shareholding isn't available in the traditional arena
stock market. This makes it difficult for those who don't have
as much money but still want to invest. Share building accounts
allow smaller investors to buy partial shares and ignore current
share prices. Investors that have smaller monthly budgets for
shares accumulate fractions of shares on regular bases. After
awhile, the smaller investor will have invested enough to purchase
full shares. Share building accounts automate this process. For
example, if a certain share price is $200 and the investor is
paying $50 a month, it would take 4 months to earn a full share.
However, the first month they legitimately own 25% of a single
share. The second month they own 50% and so on.
During the months that the share price increases the partial
shares also increase in value. Before share building accounts and
dollar-based investing, the prospecting investor would have to
save their money every month under their mattress or in the
closet. Meanwhile they were missing out on the increasing value of
Dollar-based trading makes investing
easy for the
beginner. In fact, it is recommended that new investors that have
little or no knowledge about the stock market should start out
with dollar-based investing. It's a great way for a new investor
to get their feet wet in the
stock trading world.
brokers and online discount brokers do not
provide these types of services. Only share building accounts
allow for partial share investing. Let's say that you want to
invest $200 a month with a company that has shares for $20.25. You
can buy 10 shares, but it would cost $202.50. With dollar-based
investing, you're allowed to buy the full 10 shares for $200. The
last share wouldn't be a full share, but it would be a partial
share. The next month you invest $200 again, that partial share
becomes a full share and the processes starts over every month.
New investors that want to take the complexities of
out of the equation can do so with dollar-based investing.
There is no reason any investor should miss out on earning
opportunities. Opening a share building account and starting out
with dollar-based investing will help you understand the stock
market before making more risky investments. It is a great way to
build a foundation and start an investment portfolio.