Ever Wondered How Stocks Work?

Have you ever wondered how stocks work? What their purpose is and how you and the company that issues them make money? Look no further as I have an answer for you. This will be a short article as the answer is simple. I hope you enjoy and please like and share our social pages. Thank you.

Companies issue stocks to gain capital so they can run their business or expand their business. Going public for a company could mean hundreds of millions, (sometimes billions), of dollars in funding. You as an investor, help them raise this capital. When you purchase a share of a company you are buying a piece of that company. The company operates as it normally would but now it has to take you into consideration. If the company moves in a direction that could potential cost them sales then you as an investor might sell your shares and the company loses money. But, you buying that share puts money into their pocket.

The money raised through shares helps them fund new research, expansions, or to help consolidate their holdings in a specific field. Whatever the reason being, you help them achieve these goals. How you invest and what your strategy is will depend on you as a person. Are you looking for long term? short term? or financial freedom? Many investors out there buy and sell stocks daily to make their income. Buy a stock on the low end and when it goes up you sell to make a profit. There are risks with this strategy and you could end up losing big time so please do your research before hand.