What Is Stock Investing?

Updated

December 9, 2025

Jakarta, Pintu News – Equity investment has become one of the most popular options for building wealth over the long term. Not only practiced by professionals in the financial world, more and more individuals are now starting to look at stock investment as a way to grow their funds.

However, before diving into the world of capital markets, it is important to first understand the basic concepts, workings, risks and potential returns of these investments.

What is Stock Investment?

Shares are securities that indicate ownership of a portion of the company that issued them. The unit of a share is called a share sheet, which entitles the owner to a share of the company’s profits, proportional to the number of shares owned.

Read also: What is the Hang Seng Index?

Stocks are generally traded on public stock exchanges. Exchanges and the stocks listed on them must comply with government regulations that aim to protect investors from fraudulent practices and other illegal acts.

Meanwhile, stock investment is the activity of buying stocks in the hope that they will increase in value over time or provide dividends. It’s a volatile form of investment, but has the potential for attractive returns if managed well.

How Stock Investing Works

When you buy shares, you are buying a partial ownership of a company. If the company is growing and making a profit, the value of the shares is likely to increase, allowing you to sell them at a higher price for a profit (capital gain).

Some companies also distribute a portion of their profits to shareholders in the form of dividends.

Stock transactions are conducted through intermediaries called brokers or securities. Investors can monitor stock price movements through online platforms and decide when is the best time to buy or sell. The strategy used can be short-term (trading) or long-term (investing).

Risk of Stock Investment

Not Receiving Dividends

In general, companies will pay dividends if their financial performance is good. However, if the company is underperforming or even losing money, then they may not be able to pay dividends to shareholders.

Capital Loss

Capital loss occurs when an investor sells a stock at a lower price than he or she bought it. This is the opposite of a capital gain, where the investor profits from the difference in the higher selling price.

Liquidity Risk

If the issuing company goes bankrupt or goes into liquidation, shareholders’ rights come last in terms of payment. This means that they will only receive the remaining assets after all the company’s liabilities have been settled. In many cases, shareholders may not receive anything at all.

Stock Delisting

A stock can be delisted for various reasons, such as regulatory violations or poor financial condition. Once delisted, the stock can no longer be traded on the stock exchange.

Advantages of Stock Investment

Here are some of the benefits of investing in stocks:

Dividends

Dividends are part of the company’s profits that are distributed to shareholders. The amount of dividends to be distributed is usually proposed by the Board of Directors and then approved at the General Meeting of Shareholders (GMS). Dividends are a source of passive income for investors who hold shares in the long term.

Capital Gain

Capital gain is the profit earned when an investor sells shares at a higher price than the purchase price. The positive difference between the selling price and the buying price is the profit for the investor. Capital gains are often the main goal for investors who actively monitor stock price movements in the market.

How to invest in stocks

To start investing in stocks, the first step is to open a securities account through an authorized securities company or broker registered with OJK. After that, you can deposit funds and start choosing the stocks you want to buy. It is important to study the company’s financial statements, industry trends and related news before buying stocks.

One of the most practical and legal stock investment apps in Indonesia is Pintu. Through Pintu, you can buy and sell global stocks such as Tesla , Nvidia , Amazon , and others in the form of tokens that reflect the original price of the stock on a 1:1 basis.

This means you can invest in popular US stocks easily, right from the app, without the need to access foreign exchanges.

The advantages of trading stocks that are tokenized on Pintu:

Can buy from Rp11,000 (no minimum 1 lot)
Safe and regulated
Access global stocks without an offshore account
Can sell anytime, 24/7

Check the price of popular US stock tokens here!

Overall, stock investment offers great opportunities for financial growth, but it also comes with risks that need to be understood. With enough knowledge, careful planning, and discipline in making decisions, you can make stocks a profitable investment instrument. Start small, keep learning, and invest wisely.

FAQ

Is stock investment suitable for beginners?

Yes, stock investment is suitable for beginners as long as it is accompanied by sufficient education. Many platforms today provide simulation accounts and learning content for beginner investors.

How to get started with online stock investing?

You can start investing in stocks online by opening a securities account with a securities company, depositing initial funds, and then buying shares through the application or website provided by the broker.

What is the difference between trading and investing in stocks?

While stock trading focuses on short-term gains through quick buys and sells, stock investing aims for long-term growth in value by holding onto stocks for a period of time.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Trading crypto carries high risk and volatility, always do your own research and use cold hard cash before investing. All activities of buying and selling bitcoin and other crypto asset investments are the responsibility of the reader.

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