Equities is the term given to investments in a company listed on a stock exchange, as opposed to fixed-interest investments and property (though shares of property companies are listed on the stock exchange) . Equity is a general term for ordinary shares having an interest in profits of a company.

When a listed company performs well, a part of its profits is distributed to share holders in the form of a dividend payment. However you need to be aware that shareholders also take the risks associated with investing in equities and not just the rewards. So a fall in company profits may result in a lower dividend – and no dividend at all if the company makes a loss.

Investment in equities can be a rewarding experience but shareholders need to be aware that risk is involved; hence the warning that the price of shares can go up – and it can go down.

In a perfect world your broker would tell you exactly when to buy – and when to sell.

In an imperfect world you need to remember that, “Nobody rings a bell when it is time to sell”; and “It never hurts to take a profit.”