Stock Market Investing 101 - Learn Everything You Need to Know About Stocks With This Handy Guide
Welcome to stock market investing 101.
In this guide I am going to give you a basic overview of what stocks are and how they are traded.
Stock market investing 101 · A stock represents a proportional interest in a company, or in simpler terms a stock is a portion of the value of a company.
When you buy shares in a company you are actually purchasing a piece of that company.
· As a stockholder you will receive dividends, these are a portion of the company's profits.
You are also entitled to vote in annual general meetings.
· There are five kinds of stocks.
Blue chips, secondary, income, growth and penny stocks.
· Stocks are traded on the stock market, the biggest and most famous of these being the New York Stock Exchange (NYSE) · The terms bull and bear markets refer to the conditions of the market.
Extended periods of rising stock prices are referred to as bull markets while markets with falling prices are referred to as bear markets · Stocks are traded on these exchanges by brokers.
A stockbroker is someone who has passed a test called the series 7 exam administered by the Securities and Exchange Commission and has the necessary qualifications to buy and sell shares for their clients.
Also brokers are the only people who are legally permitted to buy and sell stock, so you must go through them in order to buy and sell shares.
· A brokerage house is a firm of stockbrokers · To trade you will need to open a brokerage account with one of these brokerage houses.
The average price for this is $2500.
· You can then give instructions to your broker to make a purchase on your behalf.
When buying stock you will need to decide if you are going to buy round or odd lots.
A round lot is merely the purchase of a group of shares, usually a 100.
An odd lot is a purchase involving less than a 100 shares.
By reading this stock market investing 101 guide you should get a pretty good overview of how the stock market works.
In this guide I am going to give you a basic overview of what stocks are and how they are traded.
Stock market investing 101 · A stock represents a proportional interest in a company, or in simpler terms a stock is a portion of the value of a company.
When you buy shares in a company you are actually purchasing a piece of that company.
· As a stockholder you will receive dividends, these are a portion of the company's profits.
You are also entitled to vote in annual general meetings.
· There are five kinds of stocks.
Blue chips, secondary, income, growth and penny stocks.
· Stocks are traded on the stock market, the biggest and most famous of these being the New York Stock Exchange (NYSE) · The terms bull and bear markets refer to the conditions of the market.
Extended periods of rising stock prices are referred to as bull markets while markets with falling prices are referred to as bear markets · Stocks are traded on these exchanges by brokers.
A stockbroker is someone who has passed a test called the series 7 exam administered by the Securities and Exchange Commission and has the necessary qualifications to buy and sell shares for their clients.
Also brokers are the only people who are legally permitted to buy and sell stock, so you must go through them in order to buy and sell shares.
· A brokerage house is a firm of stockbrokers · To trade you will need to open a brokerage account with one of these brokerage houses.
The average price for this is $2500.
· You can then give instructions to your broker to make a purchase on your behalf.
When buying stock you will need to decide if you are going to buy round or odd lots.
A round lot is merely the purchase of a group of shares, usually a 100.
An odd lot is a purchase involving less than a 100 shares.
By reading this stock market investing 101 guide you should get a pretty good overview of how the stock market works.
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