Stock profitability: What it is and how to calculate it!

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How do you track stock profitability? If you don't already do this, it's a good idea to start. Studying and understanding the different variables that impact the valuation of assets is the secret to performing well on the stock market . In the media coverage of the financial market, much is said about the macro factors that influence the stock market and general economic indices. For example, it is no news to anyone that the new coronavirus pandemic caused a widespread drop in stock markets around the world. As countries recovered from the crisis and positive perspectives were disseminated, the indices began to rise. This is a macro analysis. It turns out that these variations do not occur in the same way between shares of different companies. And that's where understanding what impacts stock profitability makes a difference. Helps you identify the most advantageous assets to invest in or update your investment portfolio.

That's what we're going to talk about in this article, which will cover the following topics: How does stock profitability work? What is the difference between profitability and profitability How important is it to calculate the profitability of an investment? How to calculate the profitability of a stock portfolio Brother cell phone list What is the secret to obtaining good profitability with shares Best investments by profitability in 2020 What is the profitability of investing in the Stock Exchange? If you have any questions at the end, just leave a comment. IMPORTANT MESSAGE : Rico created a Telegram group open to all those who want to receive our investment analysis, content and useful news about variable income. Want to participate? Just click here and access our official Telegram group . Good reading! How does stock profitability work? Finger pointing to a computer screen with a stock chart.  Keyword: stock profitability Stock profitability is the percentage of return that the investor had on the amount he invested to purchase the assets. For example, if you invested R$5,000 in a share and sold it later for R$7,500, this means you had a 50% return.




This example serves to understand the concept, but don't take it too literally yet, as there are other factors that impact profitability in addition to purchase and sale prices . This is the case of dividends , bonuses and interest on equity (JCP), which can increase income. And also taxes , brokerage fees and inflation, which pull the profitability of shares down. Adding and discounting all of this, you will arrive at the real value of the advantage (or disadvantage) you obtained when betting on a certain stock. The profitability of a share in which you are thinking of investing can also be calculated. Although past earnings are not a guarantee of future profitability, it is relevant information for decision making. New call to action What is real profitability? The difference between income, revenue or net or gross profit is already well known to the general public. But it doesn't hurt to reinforce: the net is what's left after discounts, costs and contributions. For example, a worker's net salary is what remains after contributions to INSS, income tax, among others, while the gross salary is what appears on the work card.