Can someone explain to me stocks?

Question

Basically what are stocks? what are shares? how do i make money off of this? I just need a simple answer thats how i learn best =]

Answer 1

very very simple... A big company (like Google or Microsoft) needs extra money to start up or grow. What better way to get this money than from ordinary ppl! so they issue STOCKS. A stock is a SHARE of a company. when you buy one Microsoft stock, you now own a share of the company (among the millions of other holders) The two terms are used interchangeably. Because you took the time to buy a stock of their company rather than simply putting your money in the bank, Microsoft pays you a DIVIDEND every quarter (4 months) to say thanks. Kinda like interest at a bank. You can also make money when the company makes money. When they grow, they as a company are worth more, and since you own a tiny little bit of the company, your share, or stock, is worth more too. So the value or your individual share goes up. you can then sell it for a higher price than you bought it for. Those are the two basic ways to make money on stocks. Once you start to learn more, you can learn how to make money weather the market is going up OR crashing with call and put options. there are many different ways, but dividends and growth are the most basic ways. Hope this helped. Good luck and happy investing! =)


And btw, the stock market is not only for the lond term investor. it is easier that way, but thousands of ppl are DAY TRADERS. this means they trade hundreds of stocks (even at home on their pc now) each day. granted you have to know a lot more about what you are doing, but anything is possible w the stock market. depeing on your investing stragey, and money you put in, you could make hundreds of thousands, (or go broke) in minutes. its an exciting game! so have some fun.

(also, most financial advisors, dont recomend putting more than 25% of your money into stocks unless you really really know what you are doing, cuz you will loose some eventually, and you want to have a bit of worst-case-scenario money saved.)
~peace~

Answer 2

Stocks are a way to own a portion of a company. When a company wants to raise money it sells shares of itself. So it might sell 10% of the company in the form of 1,000,000 shares of stock. When you buy a share of stock, you essentially own a piece of the company.

If the company does things to become more valuable, like release a new product, open a new location, or whatever, then the value of your stock goes up. If they do things to become less valuable, like announce that they're losing money, or they have poor sales in a given quarter, then your stock becomes less valuable.

You literally own a piece of the business. If you can get together with other shareholders who together have 51% of the stock, you could have a meeting and fire the board of directors or anything else you want them to do. Usually companies are very careful about who owns large shares of their business so they don't do crazy stuff with their power.

The value of your shares is determined by what someone is willing to pay for them. The stock market is a forum in which buyers and sellers come together. You might say you want to sell your shares for a dollar each and someone says they'll give you 95 cents. You decide to take the 95 cents so that becomes the going price for shares. The next person who buys shares isn't going to pay $10 when the last trade was at 95 cents, nor is someone going to sell at 10 cents when the last trade was at 95 cents. The stock markets keep track of all these transactions and report the latest prices of all the different stocks.

That's it in a nutshell.

Answer 3

Stocks and shares are the same

A share or stock is a part of the company's capital (investment).

When a company is just initiated, the people who put the money to start operations issue stocks or shares that represent that money or goods.

These shares can be sold to other in order to make the company grow, the more capital the greater the company is.

When shares are to be sold in the stock market (wall street, London, etc.) people can make money either by holding the shares they bought and wait for value to rise or by selling them at a higher price than the one they bought them in the first place.

It's easy, but you may need at least 10,000 to start in the stock market and want to wait for the long run, stock market is for long term, not medium or short term.

Answer 4

my dear frd..
you wanna make moeny through stocks well every one also wanna same thing, If in short term if u wanna make money you must be make ur mind speculative first. you are fresher so i will suggets to choose a company whos par lot share value is less then one dollar then study abt that company there financial assets and liability there ongoing events , order book, growth rate etc. after you ck that in last financial quater what company has paid back to it's share holders i mean what divedent it pay's. if you find every thing good than ask you share broker abt that company discuse abt it , after doing all this if you personally satisfied with all things purchase 100 share costing you 100 dollars . wait for 1 or 2 weeks and ck back share prices if they are 20 % more then ur purchase price sell shares. you also decide a stop loss in ur mind if your bought share remains under ur pauchase price u must gonna sell them immeditly.
just like that choose othere stocks and play on it.

Answer 5

Stock market, is where people can buy/sell shares. Company sell their share to raise fund, and investor earn dividend (profit sharing for buying the stock). You can profit when you buy low and sell high. For more information about stock, visit http://www.stockpickguide.com. There are stock books recommendation, and stock pick strategy.