Does someone understand Wall Street and Dow Jones?

Question

I know people can invest money in stocks and bonds, but what exactly is done on Wall Street? And why do they report the Dow Jones ups and downs everyday? I've never understood it. Can someone explain please? Like what do those traders do too?

Most of these were great answers, hard to decide. Thank you for trying to explain it to me.

Answer 1

The stock market is like a huge auction. And all the people on Wall Street and elsewhere trade on this auction through computers and intermediary workers such as market makers, brokers, money managers, bond traders, and mutual fund managers.

The prices of stocks, including those making up the Dow Jones average, are the prices that people actually pay when they buy stocks. And because it's an auction, these prices fluctuate all the time.

When many people want to sell stocks of a certain company. But nobody is willing to buy from them at their asking price. Then like in an auction, the asking price for their stocks keeps going down until somebody does buy some of their stocks. And the price at which these stocks were bought becomes the latest price of all stocks for this company.

Wall Street workers deal not only with trading stocks of companies but also with trading various bonds from governments and private companies, mortgage backed securities, cash, various financial derivatives that allow people to buy and sell some other securities in the future at a certain price, and maybe even gold.

Answer 2

The Dow Jones Industrial average is a market scorecard with just 30 stocks maintained by Dow Jones & Co., the publishers of the Wall Street Journal, soon to be part of Rupert Murdoch’s News Corp. Dow Jones doesn’t handle stock trades, it just covers the markets and provides all kinds of market data.

The Standard and Poor’s 500 index is a market-weighted average of 500 stocks picked by the editors at Standard and Poor’s, which is a part of the publisher McGraw Hill. They also don’t handle stock trades.

The Nasdaq (originally the National Association of Stock Dealers and Quotations) began as a network of dealers that bought and sold stocks over the phone. Today, the Nasdaq is operated over a big computer network that is tied into brokers and individual investors who trade online. In some cases, the computer matches up the trade. In other cases, dealers who specialize in certain stocks that are listed on the Nasdaq exchange “make a market” in that stock — which means they match orders from buyers and sellers.

Answer 3

Wall Street is the location of the New York Stock Exchange, which is the physical place where traders actually buy and sell stocks (when you trade through a broker you give an order to your broker who then has someone execute that order on an exchange). There are other stock exchanges, but the one on Wall Street is the most famous, and is sometimes refer to 'Wall St' when they're referring to the stock market or the financial community as a whole.

The Dow Jones Industrial Average is an stock index that is used to track the relative value of the stock market as a whole. It is derived from the value of the stocks of 30 of the largest corporations in the US.

Answer 4

Wall Street is the name of the street in New York City where the New York Stock Exchange physically exists... along with a lot of other related companies.

The Dow Jones is an Index, it is the overall performance of a lot top companies in several different sectors, and it helps guage how the overall stock market has performed for a given day (or time period)

Traders buy and sell stock.... tiny pieces of a company.

Answer 5

DOW Jones is the top 30 blue chip companies and as they go , so goeth the country ( it is thought ) so they report that regularly . Here are the DOW components

http://finance.yahoo.com/q/cp?s=%5EDJI

Wall Street is just where the New York Stock Exchange is located but the NASDAQ is also significant since the explosion of the tech industry .

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Answer 6

Hello girl,
i think you're asking the wrong people. You know who has the best answer and will tell you how she got wealthier by buying her own s*it. Yeah the one and only Mrs. Martha Stewart. lol

Answer 7

stocks bonds and all kinds of investment instruments are traded back and forth.

Answer 8

yes it is all up and down##