The Stock ExchangeWritten by Abdulrehman on June 10th, 2008
This article has been taken from the previous version of this blog.
The stock exchange is basically a place or market normally called Capital Market where Shares or Bonds of different companies are traded. Its basic purpose is to provide capital for companies(Ever wondered how companies became worth billions?). People in a market can purchase shares of any company that is listed in the Stock Exchange, there is an initial public offer (IPO) when first time a company offers its shares for sale in the stock exchange.
Usually 51% of the shares are held by the initial owner of the company and the rest 49% are floated into the market, it is not important for all 49% to be floated in the market at once, a company can issue shares at any time they want. The main interest of investing in the Stock Exchange used to be to simply get the profit of a company which is given to the shareholders in form of Dividend, but now the Game has turned to be to trade the shares as their price goes up usually within a day which is known as Day trading or they might be kept as Short-term or Long-term investments. Shares are usually bought through people known as Brokers. There are usually a lot of Stock exchanges in every country, for example there are 20+ stock exchanges in the USA alone. Some famous include:
- NYSE
- BSE
- NASDAQ
The stock exchange plays a major role in economy. It is the most easiest and accessible way of investment for individuals. It is a way which attracts foreign investment, which certainly improves the economy of a country. As mentioned before that the Stock Exchange is a big source of capital for companies, as buying shares is very easy. As more and more shares are purchased by the public, the capital adds up and companies start to expand to big companies, and naturally it also creates employment opportunities. It also create earnings for a country’s government , which shows its importance in a country. Hence, the stock exchange is very good for economy and also acts as a meter to check the economic status of a country.
Now that I have given an introduction to stock exchange, I will be writing about the markets that I trade in and the shares that I recommend.
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This article has been taken from the previous version of this blog.
The stock exchange is basically a place or market normally called Capital Market where Shares or Bonds of different companies are traded. Its basic purpose is to provide capital for companies(Ever wondered how companies became worth billions?). People in a market can purchase shares of any company that is listed in the Stock Exchange, there is an initial public offer (IPO) when first time a company offers its shares for sale in the stock exchange.
Usually 51% of the shares are held by the initial owner of the company and the rest 49% are floated into the market, it is not important for all 49% to be floated in the market at once, a company can issue shares at any time they want. The main interest of investing in the Stock Exchange used to be to simply get the profit of a company which is given to the shareholders in form of Dividend, but now the Game has turned to be to trade the shares as their price goes up usually within a day which is known as Day trading or they might be kept as Short-term or Long-term investments. Shares are usually bought through people known as Brokers. There are usually a lot of Stock exchanges in every country, for example there are 20+ stock exchanges in the USA alone. Some famous include:
- NYSE
- BSE
- NASDAQ
The stock exchange plays a major role in economy. It is the most easiest and accessible way of investment for individuals. It is a way which attracts foreign investment, which certainly improves the economy of a country. As mentioned before that the Stock Exchange is a big source of capital for companies, as buying shares is very easy. As more and more shares are purchased by the public, the capital adds up and companies start to expand to big companies, and naturally it also creates employment opportunities. It also create earnings for a country’s government , which shows its importance in a country. Hence, the stock exchange is very good for economy and also acts as a meter to check the economic status of a country.
Now that I have given an introduction to stock exchange, I will be writing about the markets that I trade in and the shares that I recommend.
I am Abdulrehman Agha, the guy behind 3arn.Net. I am 17 years old, and live in Rawalpindi, Pakistan. I'm in Grade 11 studying in Saint Mary's Academy. I started this blog to share my money making experiences with others through the internet.
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