These Are Some Risks Of Stock Investment That You Must Understand

These Are Some Risks Of Stock Investment That You Must Understand

Losing all your shares is a real risk in stock investment. Although it rarely happens, because the company you are buying must be completely bankrupt. Bankruptcy can occur if the company fails to pay the debt that is too large, while the product business does not run as it should, especially when investing long-term, the points about debt represented in the DER (Debt to Equity Ratio) must be taken into account. It’s because when a company is declared bankrupt, its assets will be sold to cover its obligations first. Shareholders can get final numbers. Besides that, you can also visit if you want to learn how to become a stock trader.

In addition, there is also the risk of fluctuation in stock prices. When people do stock trading, stock prices will change according to the supply and demand mechanism in the capital market. But indeed, this risk is used by all investors or traders to achieve profit from the difference between the purchase and sale prices.

There are two common types of causes that cause companies to experience a decline in share prices, namely those that attack all shares as a whole or often called systemic risk. An example is an increase in interest rates or political conditions, no matter what business you are in, it will definitely be affected.

Even stock diversification techniques will not be able to dispel systemic risk, because all stocks are subject to attack. So what to do? Wait and see!

While risks that only attack certain stocks are usually considered non-systemic risks. For example, if you hold PTBA shares, only the coal fluctuation will affect the price movement of the shares.

In addition, there is a risk of not dividends. Profit-sharing from the company to investors is actually indicated by dividends. But because the value is too small, sometimes retail investors pay little attention to things like this. Even though saving money is pretty good.
Once my colleague asked me, how many dividends do each investor get each year?

There is a concept that you all must understand that the company DOESN’T HAVE LIABILITY to distribute dividends. The decision to give or not distribute dividends is determined at the General Meeting of Shareholders.

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