Recently, I went for a meeting with a top executive of the company managing my website. After the meeting, I also used the opportunity to see one of the executives who has been my client for the past 9 years and anytime I used some stock terminologies which he will say “Abeg you don start again talk wetin I fit understand.”
So, I had to explain in simple terms that he could understand and easily relate with. So, in today’s blog, we will be looking at some types of stock, what is a bear and bull market etc.
How Many Types Of Stocks Are There?
There are two main types of stocks that investors can own: common stock and preferred stock.
When people talk about stocks they are usually referring to common stocks because, well, they’re common and they are the majority of the stocks issued. Both of these stocks represent ownership in a company but preferred shares normally come with a fixed dividend unlike the common stock, which has variable dividends. People may choose preferred stocks because in the event of liquidation, preferred shareholders are paid off before the common shareholders.
In bull market everything in the economy is going well. Stocks are rising, unemployment is low and the economy is growing.
A bear market also does not last for a set term as it can go on for years. During this period, investors have a hard time picking profitable stocks.
What Is An “Illiquid Market”?
Illiquid defines an asset or security that is not able to sell quickly due to a lack of buyers and sellers in the market. Selling it quickly would result in a loss of profit. A market would be described as illiquid if there is a shortage of interested buyers and little is being traded.
The above were basically the clarification I discussed despite the fact that he has been a longtime investor. Although it may look ordinary to those who already understand but I believe that it will go a long way to help you have a better understanding of stock market reports and analysis