The Stock Market is a place where people go to invest into different companies. Each public company has a stock behind it and each stock has a ticker symbol.

For instance, if you wanted to buy Microsoft stock you can do so through the symbol MSFT. Each share of stock represents 1 share of the business. If the company has a billion shares of stock and they sell each share for $20 it would be a $20 billion dollar business.

Buying Stocks

If you want to buy multiple stocks the best way of doing so would be to open up a brokerage account. When you open up an account you will be able to login to it online and make buy or sell orders over the internet.

You can buy as many shares as you want, you can invest into 1 share or 1,000 shares or more if you want. However if you have a lot of money to invest (were talking like $50 million plus) there are rules about how many shares of stock you can buy at a given time.

If you buy or sell too many shares at one time it will drastically affect the price of the stock. This is called price manipulation and is illegal. So mutual fund managers and billionaire investors cannot simply put a bunch of money in a stock, watch it sour, and then take it out and watch it fall. Most people will not have to worry about that because most people cannot manipulate the price of a stock if they tried.

Why Invest in Stock

Investing into the stock market has several advantages over other investment vehicles.

1. They Outperform Other Assets

Over the long term stocks tend to outperform assets like real estate, bonds, t-bills, CDs, etc. That makes them a great place to invest for growth and is the main reason why financial professionals will recommend investing into the stock market until retirement.

2. Dividends

Dividends are a great perk that you get when investing into dividend paying stocks. Since you are becoming a partial owner of the company when you buy stocks many companies will actually pay you a percentage of their earnings by issuing out dividends.

Dividends can be a nice little income that you can either reinvest or spend. If you build your retirement account up enough they may even support you by themselves.

3. Unlimited Potential

The best part about investing into the stock market is that there is virtually an unlimited potential to make money in it. There have been cases throughout history were people have made large fortunes with very small investments in relatively short time periods.

While this is not the norm, there are ways to increase your returns and do better than the market as a whole. You just need to do your research on the stock you are buying and keep learning from your successes and mistakes.

Should The Average Person Invest In The Stock Market?

The stock market it has shown to be one of the best ways to grow your money over the long term in the past. There is a reason why so many financial professionals consider it the best way of planning for retirement.  There are never any guarantees in life, which is why it is safer to diversify.  But this is one market that is worth looking into.

 



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