Why Should You Invest in Nvidia? Investors Guide

NASDAQ: NVDA, also known as Nvidia, is the name that every online gamer and tech guy is familiar with.

Nvidia has created a series of high-end GPUs and powered them with artificial intelligence.

As the demand for high-end GPUs and AI is rising, it also makes investors think about NASDAQ: NVDA as a new stock to invest in.

If you are also wondering if you should invest in Nvidia or not, then this guide is for you.

Nvidia:

Jensen Huang, Chris Malachowsky, and Curtis Priem founded Nvidia in 1993. The company headquarters is in Santa Clara, California.

The company has made its name with application programming interfaces and graphic processing units.

They offer GPU based on advanced chip technology with AI powered software.

Nvidia is a pioneer in GPU and gaming technologies.

Its GPU’s are best for:

• Online Gaming: Online gaming requires fast processing. Nvidia released a series of GeForce graphic cards that help gamers to get the best performance. I also own a Nvidia GeForce RTX 4090.
• AI and Data Centers: Nvidia is not only known for gaming GPU but also a trusted brand for GPUs that can handle high-end computing, AI training, and machine learning.

Demand for Nvidia GPUs is rising.

The high demand for GPUs raised the price of new-generation graphic cards. It also brings the potential to invest in Invidia stocks as the market value of the company is growing.

Nvidia’s Stock Performance:

Should I invest in Nvidia Stocks?

If you also have this question, then you are a regular investor.

It is necessary to understand the company’s history, progress, and performance before investing in stocks.

The demand for Nvidia products is increasing, and this is causing an increase in its stock price.

Here are the Key Metrics:

• NVIDIA Corp Stock Price: NASDAQ: NVDA’s stock price was 4.32 USD in 2019. At the time of writing this article, the stock price was above $116. It shows more than 28% growth in 5 years.
• NVIDIA Market Cap: The company’s market cap crossed $1 trillion in 2024.
• Profits Booking: Nvidia is the pioneer in GPU technology. Its market share is growing, and investors are making a profit.
• Volatility: Like any other stock, NASDAQ: NVDA’s stock price is also volatile. The increase in price is due to the high demand for GPUs and the limited supply of semiconductors.

What Drive’s The Stock Price growth for Nvidia?

There are multiple factors:

• Growing gaming Industry: In 2024, the gaming industry is set to reach $282.30bn. By 2027, it will cross $363.20bn. This shows a growth between 16% to 18%. This growth impacts the stock price.
• Machine Learning and AI: Nvidia is aggressively using AI and machine learning to power up its GPUs. Other than gamers, industries like finance, healthcare, automotive, and scientific research also use Nvidia technologies.
• Increase in Data Centers: The demand for data centers is increasing. Companies are buying Nvidia’s high-performance computing systems.
• Auto Industry: Nvidia technologies are also empowering the automotive industry. Self-driving cars are using its technology.

What Are the Risks?

Every investment comes with a risk. If you can bear the calculated risk, you can grow.

Here are the risks involved with Nvidia stock investment:

• Valuation: The company’s market cap is over 1 trillion dollars. To ensure further growth, Nvidia must come up with better technologies.
• Limited Supply of Semiconductors: Nvidia’s business depends upon the supply of semiconductors. Any issues in supply can affect the stock price.
• Competition: Nvidia is also getting competition from Intel and AMD. Both are investing millions of dollars to develop better GPUs and high-performance machines.
• Regulations: Any change in regulation that impacts GPU, or semiconductors will impact the stock price.

Should I Invest in Nvidia?

Do you still want to know if you should invest in Nvidia or not?

If you have read everything I said till now, then I have already answered the question.

Yet, here is more for you:

• Growth of Gaming: The gaming industry is booming. Nvidia is working as the backbone of the industry. The future is bright if the demand for GPUs is there.
• Calculated Risk: Nvidia’s stock price is volatile. Keep an eye on semiconductor supply and news to analyze your calculated risk.
• Growth of AI: AI and machine learning are becoming more used technologies. Every industry needs these technologies to become efficient. Nvidia must do better to see future growth.

Conclusion:

Nvidia is undoubtedly leading the GPU industry. The rising demand for AI and machine learning is working as an add-on for NASDAQ: NVDA’s stocks.

Nvidia’s stock price is rising and becoming a strong choice for investors. While investing in Nvidia stocks, keep track of the company’s performance, market cap, valuation, and competition.

Now you know that Nvidia is a good choice for stock investors. But don’t forget to keep track of news and semiconductor supply.

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How to Choose the Right Trading Platform?

An intelligent strategy to gradually increase your wealth is through stock market investing. With proper research and guidance, anyone can learn to do this.

At the same time, for those who are new to the game, it might seem like a difficult task.

Learning how to invest online and selecting a reputable broker are key steps toward achieving this goal.

In this article, we'll examine the critical factors that must be considered when selecting a reliable stock broker online and guide you in choosing the best one.

How to Choose the Optimal Broker?

How to Choose the Right Trading Platform?: eAskme

 

It is important to carefully research and compare as many options as possible when selecting the most suitable service.

When choosing the best trading platform, pay special attention to these things:

• Fees
• Investment options
• User-friendly interface
• Reputation
• Security

Fees:

It is crucial to consider the fees associated with starting to use the platform.

Different brokers can charge vastly different amounts for trading and brokerage account maintenance, so it's important to compare and find the best fit for your budget.

Investment Options:

Keep in mind the investments that align with your interests and goals.

You should ensure that the broker you choose offers those options.

Limiting yourself to a narrow range of investment options can restrict your potential returns, so it's best to find a service that offers a wide range of choices to match your preferences.

User-friendly Interface:

Another important aspect to consider when choosing a broker is the user-friendly interface of the online trading platform.

A web service that is well-designed and easy to use can streamline the process of managing your stocks, significantly save your time, and reduce stress.

As you research brokers, pay attention to the user interface and select one that is intuitive and easy to use.

This way, you can focus on your deals and not on navigating the platform.

Reputation:

It's wise to choose a platform that has a good reputation.

A convenient way to check this is by looking at online reviews, testimonials, and customers' feedback.

With this information, you'll be able to form an opinion about the broker's reputation and make a more informed choice.

Security:

This is also an important factor to consider when selecting a broker.

Make sure the platform uses a high level of security to keep your personal and financial information safe.

Conclusion:

It is always recommended to start with a smaller amount and try a few platforms before depositing a larger amount.

By considering these factors and researching, you can find a broker that best suits your needs and preferences.

Investing in the stock market has become increasingly accessible to the average person thanks to online trading platforms.

However, with so many options available, selecting the right broker for your needs can be challenging.

By considering factors such as the number of fees, investment options, the convenience of the interface, availability of research and education materials, sentiment of reviews, and level of security, you can make a weighted decision and choose the broker that best suits your needs.

Always research, and don't be afraid to try out different platforms before committing to one.

If you still have any question, feel free to ask me via comments.

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Understanding the Stock Market

Money is an essential human requirement.

Money controls many things that individuals need to go about their daily lives. "The love of money is the source of all evil," according to biblical authority.

This is because people are likely to engage in unwholesome behaviors to make money if need be. Thus, it is necessary to build wealth by making money work for you.

Understanding the Stock Market: eAskme

When it comes to the three principal aspects of financial education: earning, saving, and investing, stock market investing can be the scariest of them all.

You may have heard that stock investing may help you build money over time, and this is undoubtedly true.

No one, however, relishes making a loss. Specific questions must be answered if you're thinking about making a stock market investment and trading system.

Do you have a thorough understanding of the stock market?

Or, to put it another way, what distinguishes a stock market from a stock exchange or a stock index? What is a stock, exactly?

This article aims to provide an overview of the fundamentals of stock markets and a few key concepts.

A stock is a claim on a company's earnings and assets that represents a portion of the company's ownership.

As a result, investors own a portion of the business. The stock's value rises or declines in tandem with the business's worth.

Stock exchanges are the most commonplace to buy and sell equities. Public and private stocks are the two most common types of stock.

A public corporation sells and trades stock on stock exchanges to the general public. Shareholders who are part of the broader public own these publicly traded equities.

When a firm decides to go public, its stocks will be listed on the stock exchange.

An initial public offering (IPO) is the term for this process. Common and preferred stock are the two types of public securities.

Holders of common stock have voting rights and can expect higher long-term returns.

Preferred stock dividends are usually higher and fixed than ordinary stock dividends.

If the company goes out of business, holders of such stock are more likely to get their money back.

On the other hand, private stocks are usually resource-constrained, held by a limited amount of individuals, and not traded on any public market.

Employees and internal investors, such as managers, directors, and others, maybe the only people who get shares.

What is the difference between a stock exchange and a stock market?

Investors can purchase and sell assets on the stock market, such as individual company stakes and exchange-traded funds.

A stock market is essentially a network of exchanges where corporations can list their stock. After then, investors buy shares and trade them between themselves.

Analysts use indexes to track the performance of the entire market. A securities market index shows the performance of the stock market.

These indices function by calculating the average value of a group of securities.

When an index falls, it signifies that all of the stocks in the index's estimated value have fallen from the prior business session.

On the other hand, when an index is on the rise, the average value of all the stocks in the index is up from the prior day.

The primary, secondary, and over-the-counter markets are the three types of markets where firms, investors, and brokers can purchase and sell stock.

Companies offer stock directly to investors in the primary market.

Companies are currently marketing to large institutional investors such as pension funds, hedge funds, and mutual funds that manage money for prominent individuals rather than individual investors.

Companies aren't involved in the secondary market; it's only for investors. The stock price is usually listed on a stock exchange in this case.

Over-the-counter stocks are also available for purchase.

There is no public pricing for buying and selling over-the-counter stocks, and each transaction is performed between two people.

Finally, various factors influence the stock market's performance and whether it is rising or falling.

The political climate, social variables, interest rates, trends, and shifts in what investors like are all examples of these elements.

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Features of the Stock Exchange

Stock exchanges are an essential part of a country's economy. They are essential to businesses because they provide a way to raise the capital they need to run their businesses without incurring debts, thereby avoiding excessive costs on interest payments. Stock exchanges are typically described as a centralized and organized market in which investors meet with other exchange participants to buy and sell shares, stocks, bonds, options, and so on.

Features of the Stock Exchange: eAskme

It is a well-organized market:

The stock exchange is a formal market where buyers and sellers meet to trade following agreed-upon rules and procedures.

Only genuine companies are listed, the exchange's activities are monitored, and investor funds are safeguarded.

Companies that want to list their securities on the exchange must adhere to its rules and regulations.

A management committee:

Every stock exchange has a management committee with all management and control rights.

The stock exchange's management committee has complete authority over the exchange's management and control.

They establish exchange listing requirements for companies to meet before their shares can be listed on the exchange.

All stock exchange transactions are carried out by the prescribed procedure and under the supervision of the management committee.

Purchase and sale of securities that have been approved:

The stock market provides a venue where existing and approved securities can be easily bought and sold, allowing investors to invest in suitable securities while also allowing them to switch from one security to another in the event of a risk.

It allocates capital among firms by determining prices that reflect the actual investment value of a company's stock.

A ready market for securities ensures their liquidity and thus encourages people to channel their savings into corporate investments.

Bylaws and rules:

Stock exchange transactions are conducted in public and are governed by well-defined rules, regulations, and bylaws.

Stock exchange rules and bylaws govern all transactions. Stock exchanges operate based on specific stock exchange rules and bye-laws.

This provides investors with a high level of security and fairness and protects new investors.

Transparency:

Every day, the stock exchange makes complete information about the price and volume of stock available to the public.

The Stock Exchange provides its members with the facilities, systems, and mechanisms that enable them to obtain precise information on the purchase and sale of bids and securities.

Disseminate and keep the general public up-to-date on stock market information.

The stock exchange ensures that all market participants interested in securities have instant access to data for all buy and sell orders, thereby assisting in the fair and transparent pricing of securities.

Only authorized members are involved in the transactions:

Companies that list their securities on the stock exchange must submit an annual report as well as an audited balance sheet to the exchange. As a result, only genuine companies can operate and have their shares traded.

Listed companies are heavily regulated, and their transactions are closely scrutinized by market regulators such as the Securities and Exchange Commission.

Failure to comply with the regulations may result in the suspension of trading by the exchanges, being blacklisted by the exchange, and other disciplinary measures.

Stock exchanges are for-profit organizations that charge a fee for their services:

These stock exchanges' primary sources of revenue are transaction fees charged for each trade executed on the exchange platform, as well as listing fees charged to companies during the initial public offering (IPO) process and sales of market data generated on the exchange platform.

In conclusion, a stock exchange is an organization in an association or a company.

It is regulated by a local governing body and an in-house governing board that regulates and supervises the exchange activities.

It is governed by a framework of rules and regulations, as well as bylaws, to which all market participants must adhere; there is transparency and an open system of communication between members on the exchange; stock prices on the exchange are based on supply and demand, as well as bids placed by buyers and offers proposed by sellers; and brokers serve as a link between buyers and sellers.

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Types of Stock Exchange

A stock exchange is a centralized, organized market for buying and selling shares of publicly traded companies.

It makes it easier for stockbrokers to trade company stocks and other securities. Stock exchanges also serve an economic purpose by providing liquidity to businesses.

Types of Stock Exchange: eAskme

Stock exchanges include the New York Stock Exchange, the London Stock Exchange Group, the Shanghai Stock Exchange, and the Shenzhen Stock Exchange.

A stock exchange is also known as a securities exchange or bourse. Stock exchanges bring companies and current shareholders who want to sell stock together with investors who want to buy stock from them.

Stock exchange types are rarely discussed because they are mostly intertwined; stock exchanges that used to rely solely on their physical trading platforms have now incorporated electronic trading capabilities into their operations, blurring the distinction. But in all, we have the physical location stock exchange and the electronic dealer-based stock exchange.

Physical location stock exchanges (Organized Market):

These are formal organizations with tangible physical locations that conduct auction markets in designated listed securities.

A security exchange with an office where traders meet to buy and sell securities. Typically, there is a central location for record-keeping, but trade is becoming less linked to the physical location due to modernization and digitalization.

At a physical exchange, such as the New York Stock Exchange, orders are routed to a floor broker, who forward the order to a stock specialist.

The specialist oversees a specific stock trading and ensures a fair and orderly market.

Most exchanges began as physical locations where trading took places, such as the NYSE and the Chicago Board of Trade.

Electronic dealer-based exchanges (OTC market):

These are the electronic communication networks, abbreviated as "ECNs." An OTC market is a large group of brokers and dealers linked electronically via telephones and computers.

Stocks not listed on major exchanges can be traded in the OTC market.

Buyers and sellers are electronically matched on an electronic exchange such as NASDAQ.

Market makers provide bid and ask prices, facilitate trading in specific securities, match buy and sell orders, and, if necessary, use their inventory of shares.

Advances in electronic trading platforms have altered the trading process in many OTC markets, blurring the line between traditional OTC markets and exchanges.

The introduction of electronic trading has rendered physical exchanges obsolete. The NASDAQ, the London Stock Exchange, and Eurex are entirely electronic.

In some cases, an electronic brokering platform enables dealers and some non-dealers to submit quotes and trades directly through an electronic system.

Electronic trading systems have supplanted the open outcry system at most exchanges.

These systems can match buyers and sellers more efficiently and quickly than humans.

Many exchanges that used to rely solely on a physical trading floor have incorporated electronic trading capabilities into their operations, using both methods simultaneously.

Stock exchanges have existed for over two centuries, with the most notable being:

New York Stock Exchange NYSE:

The New York Stock Exchange is the world's largest marketplace for investors to buy and sell stock shares, and it is owned by Intercontinental Exchange (NYSE: ICE).

Nasdaq:

The Nasdaq stock market is a New York-based American stock exchange.

It is owned by Nasdaq, Inc. and is ranked second on the list of stock exchanges by market capitalization of shares traded.

Japan Exchange Group:

Japan Exchange Group is a Japanese financial services corporation that operates several securities exchanges, including the Tokyo Stock Exchange and the Osaka Securities Exchange.

The Shanghai Stock Exchange (SSE):

The Shanghai Stock Exchange (SSE) is a stock exchange in Shanghai, China.

It is one of three independent stock exchanges in mainland China and a significant stock exchange worldwide.

Euronext:

Euronext is a pan-European bourse that trades regulated equities, ETFs, warrants, and certificates. The market capitalization in May 2023 was 5.44 trillion euros.

Others are;

The Hong Kong Exchanges and Clearing, LSE Group, The Shenzhen Stock Exchange, TMX Group, The Saudi Stock Exchange (Tadawul), BSE India Limited, National Stock Exchange of India Limited, Deutsche Boerse AG, SIX Swiss Exchange, Nasdaq Nordic, and Baltics, Australian Securities Exchange, Korea Exchange, Taiwan Stock Exchange, B3-Brasil Bolsa Balcao, Moscow Exchange.

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What Is a Stock?

A stock is a financial tool that indicates ownership in an enterprise or firm and indicates a percentage claim on what the firm owns and its general profits.

Stocks are also known as "shares" or "equity."

What Is a Stock?: eAskme

Stock ownership means that the person holding the shares (shareholder) owns a bit of the company equivalent to the number of shares held proportional to the total shares.

Say a person who owns 100k shares of a company with a million outstanding shares would possess a 10% ownership. Quite many companies have shares that run into millions of more.

The basics of the stock market:

How does the stock market work, you might ask?

A million and one books have been published, explaining the basics of the stock market; you, however, do not need to read every single one of them to have a good grasp of what the stock market is about.

Stock markets aid both the selling and the buying of these stocks between companies and individual investors.

Most stock trades are often between investors.

Meaning, say you want to buy shares of a particular company and press the "buy" button through your broker's website.

You're purchasing the shares of another investor that has decided to sell, not from the company itself.

On buying the shares of a stock, you've become an investor in the company whose shares you bought.

How prices are calculated on a stock market:

In its simplest form, the prices of stocks on exchanges are dictated by demand and supply.

At any instance, there's a price for a stock, below which an investor isn't ready to sell and above which another investor isn't ready to buy.

A more precise way would be to view it as an auction market where one party is bidding to buy, and the other is trying to sell.

The more the demand for a stock, the quicker investors get to buy shares (quicker than sellers want to peddle them), commanding an upward price surge.

In another vein, investors selling stock more than buying will lead to a drop in price.

The market makers always make buying and selling your stick possible. It is imperative at this point to expatiate the working of market makers.

Market makers ensure there are always buyers, as well as sellers.

You won't always find stock buyers equal to the number of investors willing to sell; take note of the following about the process.

Market makers buy and hold shares, then continuously list ewe sell and buy quotes for shares.

Also, The highest "bidder" to buy shares that are listed from a market maker is referred to as the "bid", whereas the least selling price offered is referred to as the "ask".

A primary reason for employing the market maker system rather than just allowing investors to buy and hold shares to each other directly is to ensure there's always a seller to match every buyer and vice versa.

You do not need to wait until a buyer needs the specific number of shares you want to sell before selling. 

This is what market makers do. 

They will buy your shares straight up.

You've bought a stock, what happens?

I always have to buy and sell stocks through a broker.

A broker is an entity that has the license to exchange stocks on a stock exchange.

The broker advice individuals on what to buy and what to sell, either physically or online (processing all your transactions online).

On purchasing a stock, this, in its simplest form, is how it works;

• You inform your broker (or input online) of the exact stock you prefer to buy and the number of shares of the stock you want
• The broker escalates your order up to the exchange; then, a market maker sells the shares to you at the market price at that time.

Then the shares reflect on your account.

Conclusion:

Having discussed briefly, in the simplest way,  how the stock market works, you certainly now understand how the stock world is run.

It's a somewhat technical niche and could require mastery, so you don't burn your money.

Read up the article as many times as required until you're ready to invest in the stock market.

Still have any question, do share via comments.

Share it with your friends and family.

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