Stock Market

What Are Stocks?

Stocks, also known as shares or equities, represent ownership in a company. When an investor buys a stock, they purchase a small portion of that company and become a shareholder.
Companies issue stocks to raise capital for expansion, product development, operations, and other business activities. Investors purchase these shares with the expectation that the company’s value will grow over time.

How Stocks Work

Stock prices fluctuate based on supply and demand in the market. When investors believe a company will perform well, demand for its stock increases, often driving the price higher. If investors lose confidence, prices may decline.
Investors can potentially earn profits in two ways:

Capital Appreciation

This occurs when the value of a stock increases above the purchase price.

Dividends

Some companies distribute a portion of their profits to shareholders as dividend payments.