In the current year, we have seen a major increase in the stock price of the a2 milk company share price by 18% bringing its for the year returns to 46% increase. Despite having this increase in the prices, it’s still not late for on who is looking for investing in the company like such in the dairy industry. Here are some of the reasons why you should consider investing in a company and same goes for a2 Milk Company.
- Return on Investment
Return on investment also known as ROI is one of the biggest reasons why people may want to invest in a growing company where they expect a good return on their investment which is also known as a profit. Investment in a company’s shares or getting bond provides the owner with far more greater returns than it would by investing in a real estate or a putting your money in a savings account.
- Influence
It depends on your personality that if you have good decision making skills and would like to contribute something to the organization then investing in a company would give you an opportunity to do so. When one invests in a company, they get a right to influence over the company and an opportunity to vote at the shareholders meeting that affects the decision of the management and board of directors.
- Diversification
When one invests in a company, they do it with a mindset of diversifying their portfolio and invest in different companies and industries in order to minimize their risk. One of the biggest reasons why people invest in the stock market is that they investors want to diversify their portfolio by the investment type and industry type. This helps in reducing the risk in case of if one particular industry is facing downturns or losses.
- Dividends
Another major reason for investment in a company is that one gets dividends in return. A dividend is considered to be a distribution of profits periodically to the investors or shareholders. Organizations that pay a regular dividend to its shareholders provide a passive income stream. A company that has a highly stable financial position and has regular positive earnings per year pays regular dividend to the shareholders.
- Corporate Responsibility
Not many people may do this but there are some people who invest in a company because of the culture it follows or the work it does which helps the society as a whole. People who follow the similar culture or want to work for the society are often the ones who invest in such companies which makes them feel good about themselves. 