What is Stock Market?
The stock market is a platform where shares of publicly listed companies are bought and sold. It brings together buyers and sellers of stocks to facilitate trading at agreed prices. These trades can occur on formal exchanges like the NYSE or NASDAQ or through private markets.
The stock market plays a vital role in the global economy by allowing companies to raise capital and investors to own a portion of those companies. Investors make profits through dividends or by selling shares at a higher price than they bought them.
Globally, stock markets handle trillions of dollars in assets. For example, the combined value of the world�s stock markets runs into tens of trillions of dollars. Derivatives markets � based on stocks or other assets � are even larger in notional value, though not directly comparable to stock values.
Stock exchanges like the NYSE, NASDAQ, and London's LSE allow listed companies to trade shares publicly. Each exchange has listing rules and brings transparency to pricing and trading. Apart from large exchanges, there are also over-the-counter (OTC) markets for smaller or less liquid stocks.
Understanding how the stock market works helps investors make informed decisions. With proper research and planning, investing in the stock market can be a powerful tool for building long-term wealth.
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