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Explain the two ways that stocks can provide investors with a return.​

User Nur Rony
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Answer:

  • Dividends
  • Capital Gain

Step-by-step explanation:

A stock can provide investors with a return in terms of a dividend payout. Dividends are payments by the company the stock is of and is meant as a way of sharing some of the profits the company made with its owners (the shareholders).

Capital Gain is the second way and this works by the stock appreciating in value from when the investor first bought it. This way if the investor were to sell the stock, they would sell it for more than they bought it for. For example, Amazon stock on January 31, 2020 was worth around $2,000 but in June 30,2020 was selling at around $2,700. This would be a capital gain of $700 if an investor had bough the stock on January 31 and sold on June 30.

User Norym
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