How the Stock Market Works: A Beginner's Guide to Investment

Front Cover
Kogan Page Publishers, 2004 - 208 pages
Praise and reviews: 'Almost everyone has a stake in the stock market, directly or indirectly, yet ignorance about how it works is widespread. This book is not just for investors, but for anyone who wishes to understand our financial system, and how we all fit into it' - Neil Collins, "Daily Telegraph", City Editor. 'This book cuts through the institutions' mystique with basic information for the amateur...covers all the important issues and takes a sceptical swipe at the pretentious jargon employed by the so-called experts' - "Industry". At times of fluctuating share prices and changes in trading, an investor needs to know enough about the stock market to ask the right questions, make the right choices, and not to be taken in by sharp salesmen. Here is the grounding to strip away the hype and unlock the jargon. This fully revised new edition will tell investors what is being traded and how, who does what with which and to whom, and how to evaluate both the shares and the proponents' claims. In his acclaimed lucid style, Michael Becket cuts through the investment hype to answer such questions as: What are shares? What are gilts? What are futures and options? What about overseas shares? How do you pick a share to buy? Whose advice can you trust? When do you sell a share? There is money to be made and it does not require genius to make a fortune, but you do need care, common sense, lots of luck and the expert advice of how the stock market works.
 

What people are saying - Write a review

We haven't found any reviews in the usual places.

Contents

What are shares?
5
Returns
8
Are there other types of paper?
10
Loan stock and debentures
11
Warrants
12
Preference shares
13
What are gilts?
15
What are derivatives?
18
Market theories
81
Share analysis
83
Personal priorities
88
Building a portfolio
92
Sources of information
95
What do you look for in company accounts?
100
Annual report
103
Using the accounts
110

Forward contracts
23
Covered warrants
25
What about overseas shares?
27
How do shares compare with investmentunit trusts?
29
Unit trusts
31
Tracker funds
32
Openended investment companies OEICs
33
Exchange traded funds
35
What is the point of owning shares?
37
Long Term
39
Short Term
43
Perks
44
How much money does it take?
45
Investment clubs
48
What does it cost to deal in shares?
51
Brokers commission
52
Advice
53
Portfolio management
54
Tax
55
Where and how can you buy shares?
57
The Internet
60
Trading
62
How do you find out the cost of a share?
63
Newspapers
64
The spread
65
Why at that price?
66
What do the newspaper financial pages mean?
67
Prices pages during the week
68
Mondays
73
Indices
74
Editorial
75
How do you pick a share to buy?
77
Pet systems
78
Setting criteria
80
Other information from the company
111
Do the various ratios and formulae help?
113
Whose advice can you trust?
124
Can you recognize highrisk shares?
127
When do you buy shares?
131
Charts
137
Sentiment indicators
141
Other theories
142
What is a stock market?
144
The Alternative Investment Market
147
techMARK
148
VirtX
149
Other markets
150
Emerging markets
152
Do shareholders have any rights or duties?
153
Regulated markets
156
Codes of conduct
157
What are rights and scrip issues?
159
Script issues
160
What do you do at takeovers?
161
What if the company goes bust?
163
When do you sell a share?
166
Cashing profits
167
Tax
170
Dividends
171
Capital profits
172
Share schemes
173
Tax rates
174
Useful addresses
175
Glossary
179
Further reading
185
Index
188
Index of advertisers
194
Copyright

Common terms and phrases

About the author (2004)

Michael Becket

Michael Becket is a much-respected financial journalist who has been The Daily Telegraph`s small business editor for the past 10 years. He is the author of a number of successful books, including The Daily Telegraph`s An A to Z of Finance, also published by Kogan Page.

Bibliographic information