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Thursday, March 17, 2011

Trading Stocks


Let’s start off by explaining what a stock is and how it is traded. Companies at times need to raise money to grow and they can either borrow the money or issue stoc
ks to raise capital. Companies sell investors a stake/stock of the company. This makes you a
part owner in that company. You will not have the same rights as the owner however because you own a
share you have the right of claims on every asset and penny in earnings. Stockowners invest because they make money on earnings. As the economy continues to grow corporate earnings and stock prices grow.

The Stock Exchange specialize in the business of bringing together buyers and sellers to a list of stocks and securities. Entities of a corporation or mutual organization are who is interested in this list. Professionals obtain orders from stock investors and hedge funds traders; they then make their way to the stock exchange where they execute the orders. There are t
wo different types of exchanges; physical which is where stocks are traded at a facility which is known as “outcry” or virtual which is a network of computers where trades are made electronically. The largest stock exchange in the US is the New York Stock Exchange {NYSE}.

The stock market is a public entity {physical and virtual} for the trading of comp
any stocks at an agreed price. The world stock is estimated at $36.6 Trillion.







2 comments:

Jeanne said...

Very interesting and a positive approach to explaining the stock market. I think that the stock market is a very precarious place. Within our own generation we have see several good “bull” runs through the 70’s and 80’s and then a horrible downturn "bear" for several long years which have resulted in several cycling recessions. Many people have lost their lifelong savings within a very quick timeframe, in a blink of an eye. It’s not often you hear about the little guy making a fortune, but mostly the big corporations and top echelon that make out big time, and provide substantial earnings to their shareholders. I would prefer to stay far away from the stock market and its volatility, but some people do enjoy the thrill and dare. Interesting post.

Joselito said...

The stock exchange in my eyes reflect the speed that everyone is in. It sets the tempo on how we live here in the US or around the world.I really don't want to live like that. The stock markets isn't on my mind everyday and so just to know that it can effect my life directly and indirectly is a scary thought. It almost seems as though we cannot run our own lives. We are run by a system that can crash many lives into the ground.