Earlier people used to save money and keep them at home. But this was not the correct way of keeping the ideal money. With time, people have come up with the concept of investing the ideal money in different things that can be gold, share market, funds, etc. Nowadays many people commonly invest in the equity share market because it is one of the best platforms to earn money in a short period. Even it has two types of shares in it i.e. listed shares and unlisted shares.
Unlisted shares are usually offered by companies that have just started their business and want to grow in the market. It is great to invest in these companies because they have come up with great ideas that can be very fruitful in the future. Any of the interested people can contact the unlisted shares dealers for more details on them. Here is the list of things that everyone must check before buying unlisted shares. Let’s have a look at them.
- Check the process of investment: It is very important for the person to always check the process of investment. As the listed shares offer quick purchase through Demat account with the trading hours. But in the case of the unlisted shares, it can be a little tricky. No person can make the instant purchase of the unlisted shares, so it is better to verify the whole process.
- Who owns the shares: the investor needs to know where he is going to make investments. Being an angel investor, he should have full knowledge about the company. So that it can help him to make the best decision for his money.
- Liquidity: As the unlisted shares are not publically traded in the market. It will be a little difficult to find a buyer for the unlisted shares. These might end up being illiquid, so better be prepared for that.
- The risk involved: There is a huge risk involved in the unlisted shares in comparison to the listed shares. As the companies of the unlisted shares might be in their growth stages and can suffer a lot of losses and bad phase in their journey. This thing makes it very risky to deal in the unlisted shares.
- Transparency: There is very limited transparency in the financial position of the company that offers the unlisted shares. So it is better to invest, considering this situation.
- Tax treatment: The tax treatment is different for the unlisted shares. If the person stays invested in the unlisted shares for more than two years, the returns from it can qualify for long-term capital gains. For this, it will be taxed up to 20% of tax on the returns. So it is very important to consider this thing.
In nutshell, it can be concluded that investing in the unlisted shares with full planning can bring the best results to the company as well as the person. It is one of the best ways to get the best from the ideal money so it is better to buy unlisted shares from a trusted dealer.
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