The stock market is a vast network of activities where people buy and sell shares in publicly traded companies. These shares, also known as equities, represent fractional ownership in a company. People purchase stocks for a variety of reasons, including growing their money, getting income from dividends, or simply wanting to have a say in how a particular company is run. Share prices rise or fall over time for many reasons, including growth in the sales of a company’s goods and services and overall economic conditions.
People trade stocks on exchanges such as the New York Stock Exchange and Nasdaq. Once a company lists shares, they become available to buy and sell through brokerage accounts. The trading process matches buyers and sellers through a system that maximizes fairness for both parties. The stock market may seem like a giant retail store, with buyers and sellers constantly negotiating and renegotiating prices in response to supply and demand.
When it comes to investing, the stock market is one of the best places to grow your money over time. But it’s not without its risks, which is why it’s important to understand how the market works and the lingo that goes with it.
To get started, look up the investments you’re interested in (you can do this through your broker or robo advisor). Next, decide on a dollar amount and how many shares you want to purchase. When you’re ready to make the trade, enter your order through an online platform and wait to see what happens!