Basics | How Stock Market Works
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When you buy a share of stock, you become a part owner in a publicly held company. But what does that actually mean? Let’s take a closer look at how the stock market works
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Basics | How Stock Market Works
- 2. If you start investing in the stock market you probably wondered how stock market works
- 3. The stock market is the area to make money but only when you have full knowledge about the stock market.
- 4. If you are planning to invest in the stock market you should be aware of the facts and details about the stock market.
- 5. This is the basic question of every stock market beginners that how stock market works. The answer is very simple.
- 6. Companies go public to offer their shares or stocks and public buy shares and this whole process is known as stock exchange.
- 7. People who are interested in the stock market can use stock exchange for buying and selling shares of the company.
- 8. There are many factors involved in the stock market that helps you to know how stock market works.
- 9. Stock prices and market capitalization are the two factors that help to increase your knowledge about stock market.
- 10. *Stock prices* Stock prices means the price of a specific share sells for.
- 11. Many market factors helps to set these prices like health of economy, trends of trading, technical and financial status of the company.
- 12. *Market capitalization* Market capitalization is the actual value the company or stock that is up for sale.
- 13. To calculate market capitalization of the stock we can use following formula:-
- 14. Number of Outstanding Shares * Price of Stock = Market Capitalization of the Company.
- 15. Once you have learnt the basic formula then you have to need to know about how to buy and sell shares.
- 16. You need to create investment account to purchase stock and you can open it with a local stock broker. It is very simple to set up and fund it.
- 17. After read this article now you have the answer of your question, how stock market works and how to invest in the stock market?
- 18. Hopefully there will be no doubt in your mind about stock market and stock market investing.
- 19. the stock market then above things should keep in your mind because these are basics of the stock market.