What are Stocks?

Stocks as we know them today conjure images of fast and furious trading, computer programs, and a hectic stock exchange floor. But stocks weren’t always traded that way.

When we think of stocks today, what comes to mind for many people is Wall Street and the New York Stock Exchange. But stocks, in one form or another, have been around for centuries. In the 1300s, Venetian merchants traded debts. In the 1600s, England’s East India companies issued stocks, even though many of these businesses had no actual business (lookin’ at you, dot.com bust).

The modern U.S. stock exchange developed in the late 1700s, eventually turning into the New York Stock Exchange, where some of the biggest companies in the world are currently traded. But what are stocks?

According to Merriam-Webster, stocks are, “the proprietorship element in a corporation usually divided into shares and represented by transferable certificates.” Or in English, when you own stocks, you own a portion of a company.

Although there are plenty of reasons for investing in stocks, for most of us, they are part of a retirement plan, whether that’s through an employer-issued 401k, an IRA, or investing on our own. However, as evidenced by recessions, depressions, and crashes, investing in stocks can be risky business.

Fortunately, there are plenty of ways to lower your risk and increase your chances of making money in the stock market. One way is to add “forever stocks” to your portfolio. What are stocks you can hold forever?

Forever stocks are fairly evergreen. Typically they are industry leaders that have been growing for a while and should continue to grow for decades to come. They’re stocks you can count on to be viable not only today, but 20 or 30 years from now.

That’s not as easy as it sounds. The toughest thing in stock investing is to do nothing. That’s right, nothing! Once you buy a stock and watch it move up, down and all around for a few weeks, there is an urge to take action.

Why is that so bad?

Your very best ally in the investing business is time. Holding forever is the best way to put that ally on your side, permanently. But you’ve got to buy the right stocks.

And what are they?

1. They’re the stocks of companies with revolutionary goods and services that are likely to be in big demand by growing numbers of customers.
2. They’re the stocks of companies that are still relatively small, and thus have room to grow.
3. They’re the stocks that are not currently loved by investors and thus have the potential to benefit from improved perception as the years go by.
4. And last but not least, a stock that’s trending up, indicating that investors’ perceptions of the company are improving. This is important because perceptions are always at least as important as reality, at least on Wall Street.

To learn more about finding stocks you can hold for the long term, download your FREE copy of our report, 10 Forever Stocks to Buy Now-and How to Find the Best Growth Stocks.

These stocks might just make you rich.