A stake in the business
Investing in shares will make you part-owner of a business.
Shares can be a sound long-term investment but are very risky to
use in the hope of making a quick buck.
Shares may also be referred to as stocks, securities or
MoneySmart has information on different aspects of investing in
Benefits of investing in
The benefits of investing in shares are:
- Potential capital gains from owning an asset that can grow in
value over time
- Potential income from dividends
- Lower tax rates on long-term capital gains
Video: Luke invests in shares
How I started investing video
Find out how school teacher Luke starts investing in the
stockmarket in this MoneySmart Teaching video.
Risks of investing in
The risks of investing in shares are:
- Share prices for a company can fall dramatically, even to
- If the company goes broke, you are the last in line to be paid,
so you may not get your money back
- The value of your shares will go up and down from month to
month, and the dividend may vary
Buying and selling shares
The most common way to buy and sell shares is on the share
market using a broker or broking service. See how
to buy and sell shares for more information.
If you are new to shares, you might like to try the ASX's free online shares course.
Choosing shares to buy and sell requires time, research and
analysis. However, if you're willing to put in the time and
keep an eye on the market and economy, building a portfolio of
shares can be rewarding.
See choosing shares to buy for more
Investing in shares
There are many ways to invest in shares - each has pros and
cons. See different ways to invest
in shares for more information.
Managing your shares
If you own shares, it's important to keep up with how they're
performing compared to similar companies and the market as a
See keeping track of your
shares for some things you should do regularly to manage your
Buying shares is a good way to build your wealth
over time. As with other investment options, shares are not without
their risks. Think carefully about your options and seek financial
advice before you enter the share market.
Last updated: 15 Oct 2018