King bell
VIP Contributor
Buying and selling stocks is not just for businessmen. You can buy and sell stocks too! And if you're one of the millions of Americans out there who wants to learn how to do this, this post is for you.
First things first: what are stocks? Stocks (also called 'equity' or 'shares') represent partial ownership in a company. When you buy stock, you buy a share of the equity in that company. For example, if our hypothetical bookstore holds 100 shares total and each share costs $10, then your share would be worth $1 and cost $10 ($1 per share multiplied by the number of shares bought).
If you decide to sell this share, you will receive the company's current share price multiplied by the number of shares owned. In our example, your sale would be worth $10 ($10 per share multiplied by 1 share).
Stock prices can vary significantly day-to-day, but over time they will usually go up if the company is doing well and its profits are increasing. If a company we own stock in starts losing money, then their stock price will go down. It's really that simple! This is why stocks are often associated with the riskier side of investing - if a company does poorly or goes bankrupt, then those who invested in it risk losing their money completely.
First things first: what are stocks? Stocks (also called 'equity' or 'shares') represent partial ownership in a company. When you buy stock, you buy a share of the equity in that company. For example, if our hypothetical bookstore holds 100 shares total and each share costs $10, then your share would be worth $1 and cost $10 ($1 per share multiplied by the number of shares bought).
If you decide to sell this share, you will receive the company's current share price multiplied by the number of shares owned. In our example, your sale would be worth $10 ($10 per share multiplied by 1 share).
Stock prices can vary significantly day-to-day, but over time they will usually go up if the company is doing well and its profits are increasing. If a company we own stock in starts losing money, then their stock price will go down. It's really that simple! This is why stocks are often associated with the riskier side of investing - if a company does poorly or goes bankrupt, then those who invested in it risk losing their money completely.
