XIV Международная студенческая научная конференция Студенческий научный форум - 2022

A person has always been and will be concerned about his future. What awaits me? This question worries everyone. On what and on whom does my future depend? Since ancient times, people have been trying to answer. Probably, every person who has some money savings thinks about his future and wants to save and multiply his savings. In the modern world, one of the ways is the stock market.

The stock market is a securities market that unites those who have free funds with those who need them. Stocks, bonds and any other securities can act as securities. Also in this market, they are engaged in the purchase and sale of securities, the acquisition of property rights, the repayment of debt obligations.

There are 2 types of people in this market: traders and investors. The main differences are as follows:

1. The investor focuses on time intervals from several months, years and decades, and the trader - from seconds to weeks.

2. The trader is trying to ensure high returns on a short time interval, and the investor is trying to ensure a long one. Because of this, the investor focuses on the fundamental value of the company and on the potential increase in its value for objective reasons. And the trader is guided by the momentary state of the market.

3. The trader makes extensive use of borrowed funds to make transactions. The investor, as a rule, manages the capital not borrowed. It can be personal or held in trust capital management.

4. An investor may not look at stock price charts for months. And if he does, his behavior is weakly dependent on current quotes. He follows the chosen strategy, checks with the plan and makes deliberate and balanced adjustments. A trader cannot afford not to follow the prices of the purchased shares, since the mood in the market can change at one moment, and his entire daily yield may evaporate or even turn into a loss.

The potential profits of trading are greater and are achieved faster. However, according to statistics, 90% of novice traders lose all their initial capital and leave the market, for the remaining 10% trading turns into the main type of earnings and there is no need to talk about passive income in this case. Therefore, this article discusses the investor's approach to the stock market.

Before you start studying the stock market, its tools and investment strategies, you should give a clear answer to the question “Why do I need to invest and in how many years will I need money?” Every person has their own goals. This may be a desire to save up for an apartment, a car, education for children or creating passive income. The ability to use risky investment tools and the ability to suffer temporary losses during portfolio drawdowns depends on the planning horizon. Having answered all his questions, a person can take the path of an investor.

If we consider the US stock market, specifically the s p500 index, then on average it can give an investor 10% per annum, excluding taxes and inflation. In this case, if you invest 120,000 rubles and report the same 120,000 rubles every year, then in 25 years with the condition of reinvestment you will have a little more than 13 million rubles. To achieve a better result, you need to have more initial capital, achieve a higher percentage of profitability, or strive to report more funds annually.

In my opinion, every person should try himself in investments, because in addition to increasing wealth, investing has a number of other useful advantages.

Firstly, you will have to analyze a large amount of data, which can be useful in work and study. We will have to look for answers to many questions, look for the right information and work with it. Investing is an intellectually costly activity. In addition, in 90% of cases, you will have to look for useful information on English-language resources, which will help to improve the level of English

Secondly, it is an expansion of your horizons, because you will have to study a lot of companies from different sectors of the economy and with different business models.

Thirdly, you will get into the habit of planning your budget, saving money, buying more assets, which in turn will encourage you to strive for a higher income.

References:

1. William Bernstein, Investor Manifesto, Russian edition, translation, design. Alpina Publisher LLC, 2017

2. Differences between trader and investor - 2021URL: https://vc.ru/finance/183750-kak-novichku-ne-pereputat-investicii-i-treyding