Finance wasn’t as important in the earlier ages but, now as the world is becoming one market it has gained a great significance in everyone’s life. Most of the individuals in our society are unaware of the way the finance markets work. The common man is clueless where and how to invest in order to make the maximum out of his heard earned money.

Finance is nothing but the decisions and processes to allocate money to its most productive use to achieve underlying goals. It implicates money related decisions in all sectors of the economy.

Investing in share markets is a big challenge for individuals. Most people refrain from investing as all they know about share markets is that “they are too risky”. However , if certain factors are taken into consideration safe investments can be made.

EVALUATING A COMPANY:

As is the conception of many people the “reported profits” of a company are not necessarily a reliable indicator of the performance of a company as these profits can be inflated and falsely presented.

So, you may wonder how are we supposed to know if our money is safe? or how do we invest?

The answer is : Higher share prices, a good rate of return is the best indicator of the performance of the shares of a company. The financial decision making of a comapny can be judged by 2 factors

1.) How quickly the share prices are increased.

2.) How quickly a drop in the share values can be stopped.

#F4E