Tips On How To Proact on Active Vs Inactive Shares
2010-08-04 Share Tips| Share market Software No Comments
Active shares are those in which transactions happens every day. At the other end are shares in which transactions take place sometimes, if ever. The latter are known as inactive shares. In this book, an inactive share has been described as one, which is transacted few than two times a month, or not at all.
The main cause why shares are inactive is since there are no buyers for them. They are almost shares of companies which are not doing good and whose future prospects seem to be dim. Naturally, nobody wishes to buy their shares. As a result, prevailing shareholders of these companies find it hard to rid of their shares, even at very lesser prices. And, if nobody wants to purchase these shares, why should you? Why should you let yourself to get stuck with an investment, which you can’t offload at will, whenever you wish to? We would strongly recommend you to avoid investing in inactive shares.
How does one find out whether a specific share is inactive or not? The easiest way is to continuously scrutinise the stock market quotations, which found in the daily newspapers. If you find that a specific share has not been quoted for a long time, you can presume it is inactive. Some newspapers, like The Financial Express not only mentioned the last quoted price of each of share, but also the date when it was finally transacted. This information can aid you to affirm whether that share is inactive. Check out BSE or NSE Websites
Inactive shares can usually be purchased at very low costs. This is obvious since such shares normally find no buyers. Inexperienced investors searching for bargains are always attracted to such shares by virtue of their low prices. This is how starters are usually trapped in to doing disastrous investments, Beware of such bargains! If you ever come across a bargain, remember there has to be catch in it somewhere. It is better to hunt for value, and pay a fair for it than to look for such apparent bargains.

