How does the stock market work?
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The stock market brings together people who want to sell stock with those who want to buy stock. The buyer and seller must agree on a price before a stock can be bought or sold. When you buy stock (or equity) in a company, you receive a piece of the company and become a part owner. The stock market is made up of the:
- primary market – where the first sale (or offer) of stock by a private company to the public happens. Learn more about initial public offerings (IPOs).
- secondary market – where any subsequent buying or selling – often called trading – of a company’s stock takes place.
Learn more stock market basics.