MotionTrade Tips: Get to Know These 5 Types of Stocks!

Investing in stocks is one of the things that many people start doing to achieve their financial goals. There are various reasons why many people choose to invest in stocks. One of them is because of the ease of investing anywhere and anytime. For novice investors, before you decide to invest in stocks, it's a good idea to get to know the 5 types of stocks that have been summarized by MotionTrade as follows:

1. Blue Chip Stocks

This stock is chosen by many investors because it is a stock from a company that has a good reputation and financial performance. Usually, investors who own blue chip stocks can achieve stable dividends because issuers on the blue chip list are diligent in paying dividends.

2. Income Stocks

This stock has the advantage of paying a higher dividend than the average dividend paid in the previous year. Income stocks are very concerned about the dividend yield that is distributed annually. This type of stock is more suitable for investors who have a conservative risk profile, or have a stable dividend income target for retirement needs or children's education funds.

3. Growth Stocks

Growth stocks are issuer shares that are calculated to experience a higher growth rate than the average market value. This type of shares can be divided into 2 (two) categories, namely well-known and lesser known shares. Well-known stocks are similar to blue chip stocks that have high earnings growth and have a high reputation, while lesser known stocks are stocks that are not top brass in their industry and are less popular among issuers. Although less popular among issuers, the company has good performance.

4. Speculative Stocks

Are you an investor with a high risk profile who is willing to take risks for aggressive returns? This type of stock has the potential to generate high profits in the future, but the drawback is that it does not provide consistent profits because its movements tend to be volatile and difficult to predict.

5. Counter Cyclical Stocks

This type of stock is relatively stable during fluctuating economic conditions because it is not affected by economic and business conditions. This type of stock is suitable for you to make as a long-term investment option. Examples of issuers that fall into this category are issuers engaged in daily needs, for example consumer goods.