Australian Stock Exchange Share Price

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Category: Stocks

Shares are an important part of an investment strategy.  Being good at investing in shares is about being informed, monitoring your share’s performance on a regular basis, keeping an eye on your goals and investment strategy and participating in ongoing education as you need it. The Share market provides one of the best opportunities to achieve your long-term goals.  It’s straightforward, you don’t need a lot of money to get started, and shares give you flexibility and control. People invest in shares to make money – either through share price growth, or via income paid as dividends.

Although past performance is no indication of future performance, history suggests that Australian shares have outperformed other types of investment over the longer term. To find out more you can read the Russell report (PDF 726KB) which compares asset classes over the past 10 years. Capital growth occurs when the value of your investment increases.  People invest in shares because they offer the possibility that their price will rise. Owning shares in a company with a rising share price is one way to achieve capital growth. There are different types of Shares available on ASX: Industrial & Resources, Large & Small Capitalizations, Industry Sectors (GICS), Ordinary Shares.

As a shareholder you are entitled to share in the company's profits or earnings. For many investors a key criteria in selecting shares, is whether the company pays dividends and the size of these.  Companies pay dividends from their net earnings.  Dividend payments vary from company to company and it is not compulsory for a company to pay a dividend. To learn more take the ASX course Risks and benefits of shares and/or view the short Audio Visual presentation on Dividends. For Australian investors, dividends are often worth more than the cash payment they receive. This is because where companies have already paid tax on their profits, tax credits known as franking credits may be attached to the dividends the company pays to you. These franking credits can be used to offset tax payable by you on other income. In addition, shares held for more than 12 months qualify for a 50% discount on any capital gains tax payable.

Many people know the saying "don't put all your eggs in one basket". The Australian share market helps you to do this by offering a wide choice of companies in which to invest. There are over 2,100 companies listed on ASX. These companies are involved in a wide range of industries covering most sectors of the economy including financial services, industrials and healthcare. By investing in a range of companies you can spread your risk. Investing in shares gives you flexibility. You can buy and sell shares quickly. You can sell shares and generally have access to your money in no more than three days. Other investments often take longer to sell and get your money back. This concept is known as liquidity. Remember some shares can be traded quicker than others du e to their increased liquidity.  (Liquid investments have the benefit of greater flexibility).