What is stock market?
Pakistan Stock Exchange (PSX) Surpasses Historic 61,000 Points Mark, but how? Let’s read in this article. The stock market is like a marketplace where companies go public, meaning they offer their shares to many people who want to buy them. As an investor, you can pick from various stocks of different companies to create your investment collection. The prices of these shares change based on the buying and selling activities happening on the Stock Exchange.
How to build your stock market portfolio
By buying shares of selected companies, you create a portfolio of stock investments. This portfolio is built and chosen based on:
Company
Which companies you choose to invest in.
Sector
The industry or business sector the company belongs to.
Returns Expectation
The profits you anticipate from your investments.
Risk Capacity
How much money you can invest despite market ups and downs.
Risk Tolerance
How well you can handle market downturns and volatility.
Payouts (Dividends or Bonus Shares)
The earnings or additional shares the company gives to shareholders.
Other Preferences
Any additional considerations you might have based on your stock investment preferences.
When you buy shares of a company, you become a shareholder and can receive dividends, bonus shares, or other payouts the company offers. Additionally, you can benefit from capital gains if the share prices increase.
Stock Exchange in Pakistan
The Pakistan Stock Exchange (PSX) reached a new high, crossing 61,000 points on Wednesday that is 29th November 2023. This happened because wealthy individuals and big investors put a lot of money into stocks, expecting that interest rates would drop and stocks would be available at lower prices.
The main index, KSE-100, went up to 60,745 points, a 1.56% increase from Monday’s closing at 59,811 points. The types of stocks that don’t cost much (penny stocks) in areas like textiles, technology, food, banks, and steel were the most traded.
Experts say that people are investing more in stocks because they think the government will reduce the interest rates, making stocks more attractive than other investments. The market has been going up quickly, gaining 50% in just five months, reaching 60,000 points from 40,000 points.
The companies listed on the stock market are also making a lot of profit, and they’re sharing some of that profit with their investors. This makes more people want to invest in stocks. The government is also expected to get a lot of money from international organizations, like the World Bank, and this is making people more confident about investing in stocks.
Experts think that if things go well in the next six months, the stock market could go up to 75,000-80,000 points by the end of 2024. They say this depends on the country staying politically stable, the economy growing, and the prices of things we buy staying about the same globally. Read More one Best Project in Islamabad Park View City Islamabad
Stock Exchange vs Real estate
| Real estate | Stock exchange |
| Buying physical properties. Prices are influenced by local market conditions and the property’s location.
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Buying and selling shares of companies. Prices change based on market trends and how well companies are doing.
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| Generally provides more stable, long-term returns. Properties can go up in value and generate rental income.
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Prices can go up and down a lot, offering a chance for higher profits but also higher risks.
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| Takes more time to sell a property, and the process can be more complicated. | Easy to buy and sell shares quickly. |
| To diversify, you might need to own several properties or invest through real estate funds.
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You can easily invest in different companies and industries for diversity.
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Choosing between stocks and real estate depends on what you want from your investments, how much risk you’re comfortable with, and your personal preferences.
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Conclusion
The Pakistan Stock Exchange (PSX) achieves a historic milestone by surpassing 61,000 points, fueled by increased investments and expectations of lower interest rates. Investors build their portfolios by selecting companies based on industry sectors, return expectations, risk capacity, and other preferences. As shareholders, they enjoy dividends and bonus shares, along with potential capital gains. The PSX’s rapid rise reflects growing confidence, supported by strong corporate profits and anticipated inflows from international organizations. The stock market’s potential for further growth depends on political stability, economic expansion, and global price stability.
