To breakdown the stock market, it is a platform where investors can buy and sell shares of publicly traded companies. A few simples to know:Stocks represent ownership in a company. Shares are units of stocks. To own a piece of the company, you buy a share. A stock exchange are platforms where stocks are able to be bought and sold, like the New York Stock Exchange. The actual investors that put their money in to buy or sell stocks to eventually achieve budgetary targets. Then how it works is: there are Initial Public Offering (IPOs) which is when a company first sells shares to the public to raise capital and then eventually get traded on stock exchanges. Then some buy and sell which means investors place orders to buy or sell shares through brokers. The price at which you buy is decided by supply and demand. There are also market orders which buy or sell immediately at the current market price and limit orders that only buy or sell at a specific price or better. And also stock prices are influenced by various factors including company performance, economic indicators, and market sentiment. Then there are retail investors which is basically individual investors who buy and sell stocks for personal accounts. Also Institutional investors which organizations like mutual funds, pension funds, and hedge funds that trade large volumes of stocks. More key words that show up a lot are dividends which is payments made by a company to its shareholders, usually from profits. Capital Gains profit from selling a stock at a higher price than you bought it. Index and thats the measurement of a section of the stock market, like the S&P 500, which tracks 500 of the largest U.S. companies. Risk, in which stocks can be volatile, and their prices can fluctuate widely. And lastly, reward, Potential for high returns compared to other investment types.
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