Unless you’ve already invested in the stock market before, chances are you don’t know too much about what should be done. If you know what you’re doing, the stock market can bring you a pretty profit. However, when you’re just getting started, you don’t really understand the basics, why stocks keep fluctuating, and how you should proceed moving forward.
That being said, you may have a lot of questions. Why do stocks keep going up and down? Can you trade stocks on Forex broker platforms? What are the exchanges available on the stock market? These may be just a few of the curiosities you have at the moment.
If you want to start investing, now it’s the time. Take a seat and grab a coffee as we tell you more about the basics of the stock market.
What Is the Stock Market?
The stock market represents the collection of stocks that the public can sell and purchase on various exchanges. Stocks are securities that provide someone with an ownership interest in a particular firm. When you own a stock, it’s like having a small part of that company. Meanwhile, if you own most of a company’s shares, you have control over the way a business is run.
What Is the Difference Between Bear Markets and Bull Markets?
During bear markets, stock prices are falling. The thresholds are not always the same, as bear markets can be quite different, but they can have a drop of 20% or more. Meanwhile, during a bull market, stock prices are strong, and they keep rising.
A bear market is always followed by a bull market, and vice versa. Even though bear markets are feared, the good news is that they do not last as long as bull markets, so you will usually be able to invest in stocks and increase your funds.
How Does the Stock-Buying Process Work?
It’s not that hard to start buying stocks online. Once you get the gist of it, everything becomes a piece of cake. Here’s what you should do if you want to invest in stocks online:
- Find a brokerage to open an account.
- Look through the available stocks and figure out which ones you want to purchase.
- Decide on the number of shares you want to buy.
- Select an order type.
- Order the stock with your chosen brokerage.
- Start building your own portfolio of stocks.
What Stocks to Choose?
There’s a wide range of stocks you can invest into, respectively:
- Preferred stocks
- Mid-cap stocks
- Large-cap stocks
- Small-cap stocks
- Common stocks
- International stocks
- Domestic stocks
- Safe stocks
- Dividend stocks
- IPO Stocks
- Value stocks
- Growth stocks
- Blue chip stocks
- ESG stocks
- Non-cyclical stocks
- Cyclical stocks
- Income stocks
- Non-dividend stocks
- Penny stocks
Final Thoughts
The stock market can be confusing in the beginning, but it’s not impossible to master. Take your time to learn the basics and do thorough research before investing your hard-earned money. We hope our article will help you start this journey on the right foot.