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What is The Stock Market?

August 20
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what is the stock market

What is the stock market? This is a question the answer of which is rather complicated and can’t easily be answered in one sentence. Many people consider the stock market a place where shares are bought and sold. Yes this is true. Others consider a market as a public place where things are bought and sold. The term "stock market" is for the business of buying and selling stock. But stock is much more than these few features can suggest and has deeper explanation for its meaning.


The word stock just presents the word supply. In financial market stock means a supply of money that a company has announced. The supply is given by the people who give their money to a company hoping that the company will make their money grow.


A market is a place where things are sold and bought. Thus, the term “stock market” is the business of buying and selling stock. 


Stock market is one of the most important ways of raising money for the companies. Here businesses are publicly traded and the financial capital of companies are raised by selling shares of the companies in a public market. The liquidity that an exchange gives the investors helps them sell securities quickly and easily.


It is approved that for dynamic and economic activity the most important asses is the price of shares that can be the indicator of social mood. The stock market is usually considered the primary indicator of the company’s economic strength and development.


Stock market is also known as equity market. It is a vital area for market economy since it helps companies to access capital and gives the investors the opportunity to have a little ownership in the company. And what the investor will gain depends on company’s future productivity.


A stock market is primarily a virtual exchange of securities and derivatives. It is virtual in the sense that the market is an intangible concept, rather than a physical place, and as a result of advancing technologies traders can now get involved with little more than a laptop or mobile phone. The market brings together a range of traders of all shapes and sizes - from small, one-man bands trading for their own personal gains through to hedge funds managing billion in assets, and everything in between.


The History of Stock market goes back to the early 17th century. The first public stock market is the Amsterdam Stock Exchange. The Dutch exchange started the trend of buying and selling shares of company stock. There are now exchanges in a majority of developed countries. The largest ones are in the United States, the United Kingdom, Canada, Germany, China and Japan.


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