What is the stock market?
Today we approach you one of the great stock market concepts: we delve into the stock markets, also known as stock Exchange or "the Bag ". We believe it is important that you know how it works, what kind of assets are exchanged and what you can bring if you decide to start investing in the stock market. Started!
The stock market is, roughly, the space in which companies that want to capture financial resources and citizens who have capital and want to invest in these companies. Therefore there are some emitters that put in circulation actions to capture the economic resources and investors that invest their capital in those companies that wait for them to contribute benefits.
This is why one of the most repeated phrases in the stock market and markets is that they work according to expectations: Operators invest their capital in wait and with the expectation that the company they have trusted will return benefits.
Stock market assets
In addition to being secondary, the stock exchange is a variable-income market. What does this mean? It means that the yields of the shares, in dividends, subscription rights or capital gains (concepts that we will see later), are not fixed and known in advance by the investor but they depend on the economic situation of the Context in which a particular bag is framed and the specific situation of the company to which these assets belong. Broadly speaking, it means that the benefits depend on the fluctuations of the shares.
What does the stock market bring you?
If you decide to start investing in the stock market, you should know what the stock Exchange can bring to you:
It gives you a destination for your investment. That is, it allows you to invest in a certain capital that you give up momentarily with the expectation of profitable in a certain time.
It gives you liquidity. It allows you to close your investments when you decide to get the liquidity that has generated product of your investments.
It proposes you a safe way of investing.
The stock Exchange guarantees economic and legal security.
It allows you to become part of a company. By buying shares from a particular company, you enter your group of shareholders and this gives you certain rights. This aspect is not usually taken into account because most investors usually acquire shares for the pure economic benefit.
It gives you profitability. The stock market is one of the most profitable investments today. However, you have to be very clear and assume that it also carries certain risks and you have to learn to have them controlled and minimize them.
In next posts we approach new concepts that you should know before you start in the world of stock market investment. To finish, we throw you a question: Do you know the difference between technical analysis and fundamental analysis in stock market?
This is another question you should know to solve if you have stock exchanges and you are thinking about making your savings profitable through the investment in the stock market. In this way, you will be able to define your strategy of introduction in the bag and follow it according to the type of analysis that you decide to make. See you next week!