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Questions and Answers
What is the primary function of a stock market?
What is the primary function of a stock market?
Who are the individuals, institutions, and organizations that buy and sell stocks?
Who are the individuals, institutions, and organizations that buy and sell stocks?
What is the name of the platform where stocks are traded?
What is the name of the platform where stocks are traded?
What is the term for a measure of the overall performance of a particular stock market or segment?
What is the term for a measure of the overall performance of a particular stock market or segment?
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What is the term for a prolonged period of rising stock prices and economic growth?
What is the term for a prolonged period of rising stock prices and economic growth?
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What is the term for instructions to buy or sell stocks?
What is the term for instructions to buy or sell stocks?
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What is the type of stock that represents ownership in a company and gives voting rights?
What is the type of stock that represents ownership in a company and gives voting rights?
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Which organization is the primary regulator of the US stock market?
Which organization is the primary regulator of the US stock market?
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What is the term for stocks that pay regular dividends to shareholders?
What is the term for stocks that pay regular dividends to shareholders?
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What is the term for a self-regulatory organization that oversees brokerages and trading activities?
What is the term for a self-regulatory organization that oversees brokerages and trading activities?
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Study Notes
Stock Market
Definition
- A stock market, also known as an equity market or share market, is a platform for buying and selling company stocks and other securities.
Key Players
- Investors: Individuals, institutions, and organizations that buy and sell stocks.
- Listed Companies: Publicly traded companies that issue stocks to raise capital.
- Stock Exchanges: Platforms where stocks are traded, e.g., New York Stock Exchange (NYSE), NASDAQ, London Stock Exchange (LSE).
- Brokerages: Intermediaries that facilitate buying and selling of stocks, e.g., Merrill Lynch, Charles Schwab.
Stock Market Indices
- Stock Market Indices: Measures of the overall performance of a particular stock market or segment, e.g., S&P 500, Dow Jones Industrial Average (DJIA), FTSE 100.
- Index Components: Stocks that make up an index, e.g., Apple, Microsoft, Amazon.
Stock Trading
- Bull Market: A prolonged period of rising stock prices and economic growth.
- Bear Market: A prolonged period of falling stock prices and economic decline.
- Orders: Instructions to buy or sell stocks, e.g., market order, limit order, stop-loss order.
- Trading Hours: The time period when stock markets are open for trading, e.g., 9:30 am - 4:00 pm ET (NYSE).
Stock Types
- Common Stock: Represents ownership in a company and gives voting rights.
- Preferred Stock: Has a higher claim on assets and dividends than common stock, but typically no voting rights.
- Growth Stocks: Stocks of companies expected to grow rapidly, e.g., technology startups.
- Dividend Stocks: Stocks that pay regular dividends to shareholders.
Regulation
- Securities and Exchange Commission (SEC): The primary regulator of the US stock market.
- Financial Industry Regulatory Authority (FINRA): A self-regulatory organization that oversees brokerages and trading activities.
Stock Market
- A platform for buying and selling company stocks and other securities
Key Players
- Investors: individuals, institutions, and organizations that buy and sell stocks
- Listed Companies: publicly traded companies that issue stocks to raise capital
- Stock Exchanges: platforms where stocks are traded, e.g. New York Stock Exchange (NYSE), NASDAQ, London Stock Exchange (LSE)
- Brokerages: intermediaries that facilitate buying and selling of stocks, e.g. Merrill Lynch, Charles Schwab
Stock Market Indices
- Measures of the overall performance of a particular stock market or segment
- Examples of stock market indices include S&P 500, Dow Jones Industrial Average (DJIA), FTSE 100
- Index components are the stocks that make up an index, e.g. Apple, Microsoft, Amazon
Stock Trading
- Bull Market: a prolonged period of rising stock prices and economic growth
- Bear Market: a prolonged period of falling stock prices and economic decline
- Orders: instructions to buy or sell stocks, e.g. market order, limit order, stop-loss order
- Trading Hours: the time period when stock markets are open for trading, e.g. 9:30 am - 4:00 pm ET (NYSE)
Stock Types
- Common Stock: represents ownership in a company and gives voting rights
- Preferred Stock: has a higher claim on assets and dividends than common stock, but typically no voting rights
- Growth Stocks: stocks of companies expected to grow rapidly, e.g. technology startups
- Dividend Stocks: stocks that pay regular dividends to shareholders
Regulation
- Securities and Exchange Commission (SEC): the primary regulator of the US stock market
- Financial Industry Regulatory Authority (FINRA): a self-regulatory organization that oversees brokerages and trading activities
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Description
Learn about the stock market, its key players, and how it works. Understand the roles of investors, listed companies, and stock exchanges in the equity market.
