Find solution
How does the stock market work?

How does the stock market work exactly?

  • if i were to invest 10k into a specified amount of stocks, would i make money on the shares i own daily if there were significant gains in that company? is the stock market an investment solution where one can invest then pull the money out 3 days latter with some sort of gain? please help. thanks

  • Answer:

    Stock certficates ("stocks" for short) represent partial ownership in a company. If you buy some stock, you're buying part of a company. If you buy it today and then sell it three days from now at a higher price, then you make money. If you buy it today and then sell it three days from now at a lower price, then you lose money. When other people buy and sell a stock, we report that sales price as the price of the stock. If you buy a stock at $8 and three days later people are buying and selling that stock at $10 each, then you have made a $2 paper profit. This means that on paper you have made money. But until you sell the stock, the profit is not real. You don't get that $10 back until after you sell the stock. Of course, stocks rarely go from $8 to $10 in three days. But stocks that get bad news can easily go from $10 to $8. It's all based on what people think the company is worth. If you have $10k, please don't start buying individual stocks. Pick a mutual fund or a market index and let the pros pick the stocks.

anonymou... at Yahoo! Answers Visit the source

Was this solution helpful to you?

Other answers

There are different ways to play the stock market. It seems like you are the day trading type. Yes, you can buy a stock in the morning and sell it at the end of the day or a couple days later for profit, but only if it goes UP. If it goes down, you lose that money. But there are ways to make money on a stock that is declining as well. It's called "short selling" or "shorting" the stock. I suggest getting some practice at virtual stock trading sites like UpDown.com or WallStreetSurvivor.com before you risk your real money. UpDown gives you a million fake dollars to practice and learn with. WSS has a lot learning resources for beginners.

Nakor

You actually have a few questions that I will answer as best I can. Q1: if i were to invest 10k into a specified amount of stocks, would i make money on the shares i own daily if there were significant gains in that company? A1: Yes, IF there were gains, defined by me as the value of the companies stock increased. Sometimes a company's shares will go up even though a companies profits went down. Sometimes the exact opposite happens. This is largely due to speculation. Q2: is the stock market an investment solution where one can invest then pull the money out 3 days latter with some sort of gain? A2: The operative word in your question is CAN. Yes, you can make money in minutes if the stock you invested in is volatile. They call this (you may have heard the term) day trading. Write me if you have more questions, I'd be happy to help

Force Majeure

if anyone could understand exactly how the stock market works they would become extremely rich – if they wanted to of course. The stock market serves two main functions. The primary market function of the ASX is to facilitate a company’s raising of funds by issuing securities (shares) to investors. If a company wishes to set up a new business or expand its current business, it can raise money by issuing securities to investors. The secondary market function is where investors buy and sell shares on the stock market.

Jessy

check out this blog: http://www.stopfreakingout.org It provides some useful information. Lessons come frequently + market news+ other stuff.

Related Q & A:

Just Added Q & A:

Find solution

For every problem there is a solution! Proved by Solucija.

  • Got an issue and looking for advice?

  • Ask Solucija to search every corner of the Web for help.

  • Get workable solutions and helpful tips in a moment.

Just ask Solucija about an issue you face and immediately get a list of ready solutions, answers and tips from other Internet users. We always provide the most suitable and complete answer to your question at the top, along with a few good alternatives below.