The Stock Market

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The stock market is an essential part of a free-market economy, such as America’s. This is because it provides companies the capital they need in exchange for giving away small parts of ownership in their company to investors. The stock market works by letting different companies sell stocks to gain capital, meaning they sell shares of their company through an exchange system in order to make more money. Stocks represent a small amount of ownership in a company. The more stocks a person owns, the more ownership they have of that company. Stocks also represent shares in a company, which are equal parts in which the company’s capital is divided, entitling a shareholder to a portion of the company’s profits. Lastly, all of the buying and selling of stocks happens at an exchange. An exchange is a system or market in which stocks can be bought and sold within or between countries. All of these aspects together create the stock market.
The biggest stock exchanges are the New York Stock Exchange and NASDAQ. The New York Stock Exchange is a large building in Lower Manhattan that does auction-style trading with a lot of face to face interaction through specialists, brokers, and buyers. There are upper floors in this exchange on which specialists determine the prices of all the stocks. This information then travels to the brokers who work auctions face to face with buyers in order to sell the stocks. America’s biggest companies, like Coca-Cola and McDonald’s, sell their stocks through this exchange. NASDAQ is a virtual stock exchange with no physical building. This exchange was created during the 1970s but began thriving during the tech boom of the 1990s. The tech boom helped this exchange become the home of more technological companies li...

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...ting in Amazon.com might be beneficial because everything that the company offers applies to a mass amount of people. This gives the company a great ability to grow with the times and have their services stay in high demand, this proves true through the almost constant rise of the stock. Facebook might be a good choice to invest in simply because of how popular it is to people using it. The stock has shown a steady increase for a while, and I don’t see a decrease in its popularity happening any time soon, which would make for a good investment. Overall, you can never be sure of the best stocks to invest in because the stock market can change on a dime. However, with using the best available strategies to choose your stocks, and of course with a little bit of luck, having shares in the stock market can be a very financially beneficial decision to anybody who invests.

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