Stock Market 101: Stock Market Crash Course
The stock market is like a market place for businessmen. In a public market, goods are sold to the public. In a stock market however, stocks are sold to the public. Company stocks are sold in the form of shares. The more shares a person buys in a company, the higher his or her stocks are for that particular company.
The stock market consists of the primary market and the secondary market. Primary market is where companies raise finances for their operating expenses by selling shares to investors. The secondary are investors who buy and sell those shares to other investors. Their decisions are constantly based on changing market conditions.
A stock market is like an auction house. It is a systematic method of buying and selling. In a stock market though, it is a common sight to see people shouting and gesturing at one another.
The buying and selling of stocks begin in different places. If a person decides to purchase stocks in a particular company, a broker is contacted. This broker in turn takes the money of the investor and coordinates with a floor broker at the stock exchange. Usually a floor broker works for the broker or with the company selling the stocks.
At the stock exchange, floor brokers purchase the stock that the investor wants. When a deal is consummated, it is made known to a broker and the investor becomes a stockholder of the company.