Imagine you go to a food market. You buy a box of apples for $1 each. The next day, you open up a stall in the market and sell each of your apples for $2 each. At the end of the day you’ll find that you have doubled the original amount you spent. Perhaps some of the customers might realize that your prices are higher, and they’ll go elsewhere instead. The stock market works in a similar way, although stocks are not physical things. Instead, a stock represents a percentage of the company. For example, if a company has a hundred stocks for sale and you buy just one, that would mean that you own one percent of that company.
The great thing about the stock market is that you can buy stocks from many companies and sell them when you wish. People buy the stocks in the hopes that the company will be successful and make a profit. When this happens, the price of the stock rises, so each of the stockholders get a share of the profit. If they see that the business is not successful anymore, then they sell their stocks quickly, before the price drops too low. People who trade in the stock market use online tools and programs to help them monitor how the market in general is moving, as well as how individual companies are doing. Unlike our example, where a customer might just buy one apple, stock traders buy large volumes of stocks. To understand how the stock market works, it is also important to learn the basics about the economy as well.
Interested in the stock market? Explore the following resources to learn more!
- A Basic Guide to the Stock Market
- What Exactly is a Stock?
- Stock Market Facts and Links
- The 1929 Stock Market Crash
- Play StockQuest, an Online Stock Market Game
- A Cartoon Movie on The Stock Market
- The Stock Market Dictionary for Kids
- Common Questions About Stocks for Kids
- A Quick History of the Stock Market
- Investing Tips for Kids
- How Do People Make Money Through Stocks?
- What Do Economists Do in Their Jobs?
- Do You Need Math to Trade Stocks?
- Play the Savings and Investments Game
- Team Up with the Centsables!
- A Stock Portfolio WebQuest
- How Much Do You Know About the Stock Market?
- Read a Fun E-Book on How the Economy Evolved
- What If You Were in Charge of the National Economy?
- Test Your Knowledge Of Stocks and Bonds
- Can You Invest Responsibly?
- Find Some More Investing and Stock Games!
- Learn How Wall Street Works
- An Activity on Historic Stock Market Moments
- Which is the Best Investment?
- Practice Making Your Own Stock Portfolio
- What Was the Great Depression?
- Try a Webquest to Learn About the Great Depression
- A Stock Market Online Adventure
- You Are Invited to Join an Investment Club!
- The Great Depression and Stock Market Crash
- A Free Stock Market Learning Tool for Kids
- Biz Kids Talk About Money and Investing
- Junior Achievement Presents Saving & Investing
- Can You Save the Stock Market?
- Watch a Video that Illustrates the Stock Market
- Play Stock Market Mania!
- An Activity to Learn About the Stock Market
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