Stock Market For Beginners What You Need To Know

When we talk about investing in the stock market, we must understand that it is more than buying and selling shares. This activity can also be linked to other financial instruments where it is possible to operate in the short, medium, or long term.

The investment method used in the stock market is called "invest" if it is long term or "trading" if it is short.

Stock trading has become popular in this area of the stock market. This activity can be started online from anywhere in the world and consists of the sale and purchase of financial assets.

Trading consists of buying or selling an asset, then reselling or repurchasing it, and obtaining the respective profit. The advent of online trading has allowed many to invest in the stock market with little money, without owning large amounts of capital.

To manage the stock market, it is important to document yourself and study well the type of investment you are going to make.

What is the stock market?

The stock exchange is an organization where transactions of different financial instruments are carried out through authorized intermediaries. This institution provides the facilities for its members, brokers, or operators to negotiate the purchase and sale of securities.

The stock exchange originates from the City of Bruges, Belgium, within the Van der Burson family of bankers. These organized meetings in his palace to make commercial operations or to transact assets, and they had like shield three bags of skin. Then in 1460 in Antwerp, Belgium, the first modern stock exchange arose, for years later, expanding to other countries.

Who integrates it?

The stock market has been made up of companies, organizations, or public and private entities, which are the applicants for capital. Savers or investors who are the capital providers and intermediaries, brokers, brokerage houses, etc. also participate.

For companies to be able to list their securities on the stock market, they must publish their financial statements to determine their financial situation. When a company makes an offer on the stock market, anyone can know the information and performance of the company.

The stock exchange works like a large market or mall where stocks are bought and sold daily. Companies are listed on the stock exchange because it allows them to obtain new capital without having to borrow or borrow.

In this medium, any company can quote, as long as it meets the standards and the minimum investment requirements.

Role of the stock exchange

The time has come to show you what you want so much to know. Get ready to know what is the mission of the stock market in any part of the world:

·         Facilitate the transactions of the resources so that a better allocation of them is feasible.

·         Support transactions by providing legal certainty.

·         Guarantee liquidity, since assets such as shares and securities are converted into money.

·         Inform truthfully and permanently concerning the values, operations, financial statements of companies, among other things.

·         Contribute to the growth as well as the development of the capital and securities market.

·         Organize the stock market through stock market operations.

How does the stock market work?

Below I will show you how the stock market works internally.

Undoubtedly, this is information that you must know before entering this wonderful and fluctuating financial world. Do you want to know them?

When a person has to buy or sell part of a company, he does it through the stock market.

If the company sells its shares for the first time, it makes a public offering known as the "primary market."

For a company to grow, it needs additional capital that requires the contribution of new partners.

Shares are issued to find these partners that are sold in the so-called public offering to those who are interested in investing. When a public offer is made in the stock market, the company is made public, and the interested party obtains the shares.

Subsequently, this shareholder can, in turn, sell his shares in the future if he decides, according to his convenience. In the same way that other investors buy it, they also evaluate the updated information of the company for their convenience.

Analyzing the information allows the feasibility of a good offer to change significantly from one day to another.

The purchase and sale price of shares is set by free-market laws, that is, supply and demand.

Those who buy set the purchase price and those who sell do the same; this is how operations are carried out, both actors setting their stance.

The shareholder always expects to earn periodic dividend earnings, or by selling his shares at a higher price. The holder is an investor who, by acquiring a bond, expects to generate regular interest or profits at the end of the term.

Stockbrokers are responsible for conducting transactions between sellers and buyers of shares. Investments in shares are considered variable income, while investments in debt as fixed income.

Can I invest in the stock market from home? Here I tell you everything!

Investing in the stock market may seem like a complicated task and only for large entrepreneurs, but in reality, anyone can do it. I only recommend that you study very well what it is and of course you go to the experts in the stock market.

Thanks to the internet, this market can be accessed more easily from home or mobile by different applications. However, just because it is easy to invest in the stock market online does not mean that it is easy to obtain earnings by shares.

Investing in the stock market online maintains the principle of buying and selling shares; it is done through online brokers. Benefits are obtained without the need to be in a specific place to operate the exchange, from where you are.

The online brokers will be the tool that will help us gain access to financial markets to invest in the stock market. You can invest in national securities and also in any company in the world, from small to large companies.

These so-called brokers can be obtained on web pages, applications, and other means such as banks (which allow investing from home).

The procedure is generally as follows:

·         Open an account in a broker, the platform for trading your preference.

·         You will obtain the corresponding username and password (if applicable).

·         Each account will be associated with a bank account, where the money you will use for purchase and sales orders will be. The bank account will enter the money from the sale of shares, collection of dividends, and any other operation.

·         Each operation will generate its commission, and you must bear in mind the brokerage costs, administrative expenses, and stock fees.

·         Brokering costs are generally based on a percentage of what is invested for the services received. The costs or administration expenses depend on the country where you open your account; the commissions vary due to different factors.

Invest in the stock market: What platform to use?

There are many platforms to invest in the stock market. Below I will mention some of the most popular brokers or online trading platforms to invest or trade.

However, don't stop to decide! Take your time to try until you get the one that makes you feel safe and comfortable according to your needs.

How much money do I have to invest in the stock market?

You may have in mind that to invest in the stock market, you need to have a lot of money, but it is not.

I have good news for you, and it is that you do not need a lot of money, although I cannot give you a specific figure. Anyone can invest in the stock market on their own, without having as much money available to start.

When you invest more money in the stock market, it does not mean higher profitability; it is recommended to think in percentage terms, in terms of investment. You should start with little money to experiment, and then increase the investment according to the results obtained.

My primary recommendation is that you should save. That is, you need to have the ability to save to generate money, which you will then invest consecutively.

It is essential to make it clear that initially, your goal should be to gain experience and train. It is a complicated world, where many people end up losing a lot of money. It occurs because they do not form before fully entering the stock market investment.

You should also take into account the impact in terms of money that the associated commissions will have on your investment. Remember the commissions for a capital increase, custody of securities, purchase, and sale, collection of dividends, etc.

Can I start investing in a stock simulator?

A stock market simulator is a computer program with a very advanced interface that allows you to learn how to spend money in the stock market online. It has all the necessary tools to practice in real-time as if you were in the stock market.

It can support you as a fundamental tool to start trading in values and make some decisions without any risk! These simulators can be found in some specialized brokers or banks, and they are complex applications that are being commonly used.

Operating a simulator can avoid many headaches, helping you to train and learn, to have good knowledge. It enables you to get familiar with the interface handling play money, seeing the results of your decisions, to jump to reality.