Sunday, July 6, 2014
An company would invest in stocks because the potential win is huge. If the companies stock rises, the companies payday would be huge. Since companies have more money and could put more money in the stock. If the companies stock does rise and get a good payday, the money you win could go into the company and to expand the company. By expanding the company, you could make more money with improvements and new ways. That is how a company rises and and attracts more consumers. With a company investing in debt securities, the bonds they received are added up in interests and the bonds that were initially 100 dollars are now a lot higher with interests. By having bonds, the company will have more money in the pocket and more money in the bank. In which, can go a lot further into the companies ways. By having stockholders, you have more investors that give you money to the company to expand the company. Plus, more opinions to make the company better and new ways to improve. But if the company does not do good, depending on the deal, you could be out a lot of money and would have to pay the stockholders back. That would be money out of the pocket you do not have. It is not always bad to have binds because after years, the bonds turn into a lot more money and more money given to you, which is nice. However, having bonds is like a waiting game. Since you cannot cash bonds for years, that is the downfall for investing into bonds or another name, debt securities.