The Basics of Buying Stocks and the Stock Market

The Basics of Buying Stocks and the Stock Market

Length: 445 words (1.3 double-spaced pages)

Rating: Excellent

Open Document

Essay Preview

More ↓
The stock market is a vehicle to invest money. It is where consumers buy and sell fractions of companies, and is referred to as stocks. A proven method to achieve wealth while keeping up with inflation, comprised of publically held companies who offer goods and services that are used by the general public daily. Companies sell stocks to public investors in a free and open market environment on a daily basis, which is an effective strategy to build a sound financial future.
Stock investment means you are purchasing a share of the company, therefore the company’s success determines the value of your investment. Buying stocks is not a difficult process; clarification of some important terminology and differentiation helps gives you the foundation to start investing.
Common stock is a term that is synonymous with investing; it is ownership in a public company. The stock owner is granted voting rights in addition the ability to receive dividends. It is a common terminology that is heard frequently in terms of the daily performance of the stock market whether it was up or down.
Another terminology is Preferred stock, which varies in comparison to common stock investors are paid dividends consistently.
Dividends is used often with the stock market, dividends are profit you receive when the company makes a profit. If the company does not make a profit, you will not receive a dividend reimbursement. Payments can be reinvested, which helps build wealth because you are increasing your portfolio. You can also so use this cash for whatever you like.
Dollar cost average is an effective investment strategy that is used to build wealth over time. Invest for the long term should be the goal of all investors. If this is the goal, stock market fluctuations can be a good thing. You benefit when the market is down because you are purchasing stocks at a low price when over time you are attaining more bang for your dollar.
The stock market is a centralized area where buyers and sellers comes together to perform stock transaction. When one thinks of the stock market, the first thing comes to mind is Wall Street which is sometimes referred to as the New York Stock Exchange as well as the NYSE.

How to Cite this Page

MLA Citation:
"The Basics of Buying Stocks and the Stock Market." 25 Jun 2019

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Personal Experience : The Stock Market Game Essay

- Part 1: Personal Experience The stock market game is a great way to learn and understand how stocks work. I ended up learning that going all in and shorting stocks was the quickest way to make money. Unfortunately, it is also the best way to experience the slaughter when stocks go other than what you predict. In the beginning, I did not truly understand how to play the stock game. I was afraid and put clumps of money in different stocks. The cost was hundreds and hundreds of dollars that. Slowly as I tested shorting with Sunedison (SUNE) I began making up the money that I lost....   [tags: Stock market, Stock, Short, Share]

Research Papers
1971 words (5.6 pages)

Exploring The Basics Of Shares Investing Essay

- Book Blurb Learn everything you need to know about shares investing, from a definition on what it means, to how you make money from shares. This book gives you an in-depth look at shares in a light and easy-to-read fashion. There are no complex calculations, no trends analysis, and no esoteric words that only economists understand. It is a simple guide to shares investing in plain English that gives advice on everything from how to become a clever investor, to how to avoid fraudsters and losing it all....   [tags: Investment, Finance, Stock, Stock market]

Research Papers
1081 words (3.1 pages)

Why Large Corporations Require Additional Monetary Funds For A Corporation, Stocks And Bonds

- When large corporations require additional monetary funds to expand their businesses, they offer the opportunity of investment in stocks and bonds to the public. Investors purchase the stocks and bonds with the intention of making a profit from the investment sometime in the future. A mixture of stocks and bonds make up the majority of asset holdings in most investment portfolios. Although issued for the same purpose; To raise money for a corporation, stocks and bonds differ in many ways. The main difference between a stock and a bond is the position of the investor in the sale of the security....   [tags: Stock, Stock market, Stock exchange, Bond]

Research Papers
1494 words (4.3 pages)

The Market Equilibrium Of Housing Industry Essay

- Market Equilibration Process Equilibrium can be defined as a state where the demand and supply balance one another and that in result stable the prices. The current economic situation causes a state of disequilibrium in housing industry. Because of the economic condition, people are losing their jobs or they are not receiving enough pay so it becomes difficult for the people to purchase a house. This paper will explain about the market equilibrium of housing industry and how the changes in supply and demandresulted in disequilibrium....   [tags: Supply and demand, Economic equilibrium]

Research Papers
739 words (2.1 pages)

The Stock Market And Stock Exchange Essay

- This paper will encompass the importance of the U.S stock market/stock exchange versus the Chinese stock market/ stock exchange, with a brief introduction about how each stock market/stock exchange came into existence, the importance of each stock market/stock exchange, how the U.S and Chinese manage their stock markets/stock exchange, how corporations are appointed plus the rules and regulations. This will also entail random facts about each stock market/stock exchange. Stock markets are like hitting a royal flush, if the price of your stocks goes up, you win; if it drops, you lose....   [tags: Stock market, Stock exchange, Stock]

Research Papers
2138 words (6.1 pages)

How The Stock Market Was Doing Essay

- During the first week of this finance project, I did not select to buy or sell any additional stocks. It took me a little while to figure out the charts on Yahoo Finance and see how the stock market was doing. For this reason, I just chose to observe and record my stocks every Monday, Wednesday, and Friday in order to be consistent. I have never invested or even thought about stocks before starting this class. This class was very helpful and informative to me for this case. In an excel spreadsheet, I tracked down the price of each share for each day, as well as the new values in order to see how much money I have lost or gained....   [tags: Stock market, Stock, Share, Investment]

Research Papers
1000 words (2.9 pages)

Financial Investment At The Stock Market Essay

- QUESTION 1 (i) Security markets refer to any type of financial investment at the stock market. A security market encompasses; equity markets, bond markets, and derivatives markets. Only a few companies in East Africa are enlisted at the stock exchange due to the technicalities of listing companies and the disadvantages that comes with it. Enlisting a company at the securities exchange market has advantage and disadvantages. The following are some of the advantages and disadvantages of enlisting a company at the securities exchange market; Advantages of Enlisting a Company at the Securities Exchange Market (a) Free Coverage and Publicity; Enlisting a company at the securities exchange market...   [tags: Stock market, Stock exchange]

Research Papers
1382 words (3.9 pages)

The Stock Market Crash Of 1929 Essay

- Stock Market crash Homeless starving families roaming the streets, billions of dollars lost never to be returned, and darkness and depression encompassing all aspects of life. This may sound like an impossible nightmare, but in reality millions of people suffered through these events thinking only of survival and how to get through the next day. What, could cause such horrendous events as these. Well, all of this was a result of what is known as the Stock Market Crash of 1929. In brief, the economy of the United States of America failed due to flaws within the market, and misunderstandings of its risk....   [tags: Wall Street Crash of 1929, Stock market]

Research Papers
1765 words (5 pages)

Essay on Playing the Stock Market Game

- There are many different ways to save money and there are different things to save for. A savings plan for an immediate want is apparently different than a savings strategy for retirement. One may choose to select stocks, bonds, or mutual funds for a savings strategy, however, my personal choice is to invest in bonds first, then mutual funds. My savings strategy selection process for an immediate want includes taking a portion of my income and storing it in a money market bank account to cover the expenses, since the interest rate changes daily for money market accounts....   [tags: stock market, ]

Research Papers
670 words (1.9 pages)

Market Watch: Regulation of the Stock Market Essay

- Market Watch: Regulation of the Stock Market The Enrons and Worldcoms made it clear that the financial markets cannot be left under the auspices of corporate directors and officers, without oversight authority. "The corporate abuses and fraud that Enron exemplified, while not a first in the financial markets, they were certainly a first in terms of the magnitude of the losses to stockholders and the confidence the public reposed in the financial sector (Bequai 2003)." As a result of the stock market crash of 1929 regulations such as the Securities Act of 1933 and Securities Exchange Act of 1934 were established to prevent such practices as those that contributed to the downfalls of Enron an...   [tags: Stock Market Crash 1929 History]

Free Essays
1666 words (4.8 pages)

This is the leading trading house in the world and offers some of the largest and well known companies. Investors ran the gamut from the small investor to investors with a large amount of assets.
The stock market is the only entity that has provided return of over ten percent over a long period. If you are looking for long term investment, stocks are the best alternative.
Return to