Stock Exchange

money · business · investing

What stocks are. When you buy a stock, you own a tiny piece of a company. If that company does well and makes more money, your piece becomes more valuable, so you can sell it for profit.

Trading floor action. Stock exchanges work like auctions where buyers and sellers shout out offers to trade, or nowadays computers match them together electronically. When someone wants to buy and someone wants to sell at the same price, the deal happens instantly.

More than just stocks. Stock exchanges don't just handle pieces of companies. They also trade bonds (loans people give to companies), funds that pool many investments together, and other financial tools that help people grow their money.

Exchanges everywhere. Major cities around the world have their own stock exchanges, like the New York Stock Exchange in America and the Tokyo Stock Exchange in Japan. These connect millions of investors buying and selling every single day.

Companies go public. When a company is ready to grow big, it can list itself on a stock exchange so regular people can buy and own pieces of it. This helps the company raise money from investors who believe in its future.