Stock investment means that one owns a certain percentage of the equity of the company while bond investment implies that the person is lending to the particular company money that is repaid with interest upon maturity. In stock investment, when dividends are released to individuals with shares in the given company, one benefits as well. When the company makes losses, the person in question also makes losses. Bonds, on the other hand, have a fixed interest rate agreed to be paid to the investor upon maturity.
Valuation is the process or the steps that are involved in the calculation of the current market value of an asset owned by a given company. A company's security, as well as intangible assets, can be used in the above process.
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Coca-Cola stock prices show a fluctuation trend since 2014 to date. Within the past year, the highest rate has been $48.62 and the lowest price $41.45. Regardless of the seemingly high fluctuation, there has been a small margin of $0.1 between today’s stock opening and closing price. The above is a 0.28% increase. With a volume of 10,664,380 shares, the market capitalization stands at $183.49B.
Given the nature of bonds where the returns are fixed and that of the stock which the returns fluctuate depending on the company’s undertakings, the best investment, especially for an entrepreneur who is a risk taker is the stock investment. This is because, with long-term knowledge and experience in analyzing the stock market, it is possible to know market trends and the best time to invest as well as withdraw after making the target profits. Bond investment is not the best because even though there are fewer volatility risks, it is possible to lose all of one’s investment when a company goes bankrupt, unlike in stock investment where one can sell their shares upon perceiving such a threat.
