Shares
Shares are also known as equities or stocks. Companies issue shares to raise money. In exchange the investor receives part ownership in the company and is entitled to a portion of the profits. As the company grows, profits are expected to grow and the value of the shareholder’s investment is also expected to rise.
A company’s share price fluctuates daily according to what investors collectively think the company can earn in the future compared to what other investments are expected to earn. This means that share prices can fluctuate substantially over short periods.
Historically, shares have shown the highest returns of all asset classes over the long-term.
Australian shares
Australian shares are investments in companies listed on the Australian Stock Exchange. Some of these companies earn a significant portion of their profits from their international operations and currency fluctuations can have an impact (positive or negative) on the earnings of these companies.
International shares
International shares represent ownership in companies that are listed on foreign stock exchanges. They provide exposure to industries and companies not available in Australia. Currency fluctuations can have a significant effect (positive or negative) on returns from international share investments