Shares also known as equities involve buying a stake in a company which gives you part ownership of the company.
The percentage of the company which you own is dependent on the number of shares you buy. Investors typically buy shares in a company because they think its value is likely to go up because of good performance or competent management.
Shares of individual companies are listed on the relevant exchanges across the world. The most popular stock exchanges include the London Stock Exchange, the New York Stock Exchange and the Nasdaq Exchange.
However one can participate in shares trading by trading derivatives such as Spread trading and CFDs.
The price movement of these products is derived from the price of an underlying share or stock and one does not need to have to own the shares which would require purchasing a stake at full market value. Trading shares using spread trading or CFDs can be an efficient way of using your capital as the use of leverage means you only have to pay a small percentage of the notional value of your position.
Disclaimer – Futures, CFD, Margined Foreign Exchange trading, Warrants, Options and Spread Betting all carry a high level of risk to your capital. Only speculate with money you can afford to lose. Futures, CFD, Margined Foreign Exchange trading and Spread Betting may not be suitable for all customers, therefore ensure you fully understand the risks involved and seek independent financial advice if necessary.
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