A stock is essentially a piece of a company. You are a shareholder when you own a stock. The shareholder will share in the companies profits and has a voice about how the company is run.
The company sells stock because they want to get capital, to expand the business or some other reason. An example would be when company needs to purchase new property or have extra cash. Its projected value depends on the growth and success of the company.
If a company is successful, it's stock price will rise. Companies that have been thriving for a while will have high valued stock. These investments will be safer but may yield small returns. A newer company, because they do not have long proven success, will have cheaper stock. If the company succeeds, their stock may sky rocket in value. On the other hand, the company may fail completely and you will loose your investment.
An investor will buy and sell stock through the National Association of Securities Dealers Automated Quotation System (NASDAQ) or the New York Stock Exchange (NYSE). Companies who are on this exchange system may sell their shares on the open market. You may also purchase stocks that are not on the exchange, but we do not address that in this article.
If you are to invest in stocks, you will need a broker for the transactions. It is best to have a broker who can correspond with other brokers to move the stocks. The investor may tell his broker to keep an eye on a stock to buy or sell when it reaches a certain price. The brokers will follow every instruction by the investor in exchange for commissions. - 15224
The company sells stock because they want to get capital, to expand the business or some other reason. An example would be when company needs to purchase new property or have extra cash. Its projected value depends on the growth and success of the company.
If a company is successful, it's stock price will rise. Companies that have been thriving for a while will have high valued stock. These investments will be safer but may yield small returns. A newer company, because they do not have long proven success, will have cheaper stock. If the company succeeds, their stock may sky rocket in value. On the other hand, the company may fail completely and you will loose your investment.
An investor will buy and sell stock through the National Association of Securities Dealers Automated Quotation System (NASDAQ) or the New York Stock Exchange (NYSE). Companies who are on this exchange system may sell their shares on the open market. You may also purchase stocks that are not on the exchange, but we do not address that in this article.
If you are to invest in stocks, you will need a broker for the transactions. It is best to have a broker who can correspond with other brokers to move the stocks. The investor may tell his broker to keep an eye on a stock to buy or sell when it reaches a certain price. The brokers will follow every instruction by the investor in exchange for commissions. - 15224
About the Author:
Laura Macavoy is a graduate student from Bentley University. She has many papers published to newsletters on stock market and recession survival tips. Laura vigorously studies recession survival tips issues and shares her articles with her readers on numerous blogs. Check out more from Laura as well as many other investment gurus at Mutual Funds for Young Investors
