Stocks
The decision to invest in any company is made after considering several factors. Investing in shares is one of the riskiest investment options, although the expected returns are significantly high. The history of a company and the promise of better performance are essential in leading investors into choosing to buy the shares from the said company. Tesla and Microsoft corporations have a rich history of the movement in the price of their choices. The decision to invest in stocks of both companies takes several considerations.
Tesla, Inc. has been in business for over 15 years and has been making huge profits in the dynamic motor-vehicle business. Several reasons may make an investor decide to purchase Tesla shares. First, Tesla has stood out as the only maker to get into the electric vehicle business, and thus, investors should expect growth when consumers decide to switch to electric vehicles. Secondly, the introduction of the self-drive vehicles by Tesla should be positive news to the shareholders. Thirdly, the demand in the electric vehicle industry is significantly rising, and thus, the company is in a position to make more profits.
The decision to invest in Tesla shares could, however, be costly for various reasons. First, uncertainty remains on whether the electric vehicle business will grow or fall. Secondly, the company’s CEO’s personality causes more uncertainty among the shareholders. Thirdly, the company is operating against high expectations from investors, and the share price may be triggered by the expectations and could fall anytime.
Microsoft corporation share is among the shares with a rich history of upward and downward movements. The Microsoft Corporation shares have several factors pulling investors into choosing them. First, Microsoft Corporation has diversified its revenue system to avoid risks of loss. Secondly, the invention of cloud computing promises high profits with the demand for cloud computing being high. Thirdly, the leadership of Microsoft Corporation has been consistent in terms of performance, and thus the company is assured of profits.
Microsoft Corporation, however, faces challenges that may put off potential investors. The valuation of Microsoft Corporation has already gone up, and thus, the potential for more growth is limited. Also, the overreliance on PCs could be a risky venture in the event the demand for PCs shifts for worse. Additionally, Microsoft Corporation works against strong competitors who may take over anytime.
Despite the risks posed by buying the stocks from Tesla and Microsoft Corporation, I would recommend investing in both shares. The return promised by the two investments is high, and any wise investor will choose to invest in the companies.
Work Cited
Chandra, Prasanna. Investment analysis and portfolio management. McGraw-Hill Education, 2017.