I know stock prices go up and down, I just dont know why people buy stocks. Is it because they get paid dividends? I'm not talking about swing or day traders, i mean institutions and LT holders. Some companies dont pay their shareholders divs, so where is the real value behind a stock for say...
Short answer: $$$$
The simplest way to make money on stock is buy a stock before you think its price is going to go up, hold it for awhile, and sell it at a higher price.
You can also make money from stocks by buying shares in a company that pays a dividend, but the dividend is generally pretty small compared to the current price of the stock, so you won't really see any profit from dividends unless you hold (own) the stock for many years.
There are a lot of other ways of making money from stock but they start getting pretty complicated.
Do you realize what stocks actually are as an investment vehicle?? What they actually represent?
Its ownership in the company...as opposed to the meager returns from a savings account, this is just another way to invest your money.
Some pay dividends but most are bought hoping they can be resold later at a profit.
Day traders are few, and long term holders are many.
My retirement accounts - 401k and IRA are in the near 7 figure category. And I guarantee you I didn't put 7 figures into them.
People invest for many reasons - retirement, new house, new car, or just for a rainy day.
Everyone has there own style of investing. People buy stocks to make money. There’s no other answer. If it goes up in price and sell you make money. The same for opposite
Many stocks go up over time. It's not just the dividends. People buy stocks hoping they can choose well enough to pick companies whoe stocks will show growth over the yeqrs.