The stock market is a platform where companies raise funds by issuing shares of stock to the public. These shares represent a small portion of ownership in the company and can be bought and sold on stock exchanges such as the New York Stock Exchange (NYSE) and the NASDAQ.
When you buy a share of stock, you become a shareholder in the company. As a shareholder, you are entitled to a portion of the company's profits, known as dividends, and you also have the potential to earn money through the appreciation of the stock's value. However, it's important to note that stock values can also decrease, which is why investing in the stock market is considered to be risky.
One example of a company that is publicly traded on the stock market is Apple Inc. (AAPL). As of this writing, an individual share of Apple stock costs around $130, and if you were to purchase 100 shares, your total investment would be $13,000. If the value of the company increases and the stock price goes up to $150 per share, your investment would now be worth $15,000, meaning you made a $2,000 profit.
However, it's also important to note that the stock market can be unpredictable, and the value of a company and its stock can decrease. It's essential to do your own research and diversify your portfolio to minimize the risk.
In summary, investing in the stock market can be a great way to grow your money over time, but it's important to understand the risks and do your own research before making any investments. Stock market basics include the understanding of how stocks are bought and sold, the role of stock exchanges, and the potential to earn money through dividends and stock appreciation.