FAQ
Frequently Asked Questions
The stock market is a marketplace where stocks, bonds, and other securities are traded. It provides a platform for buyers and sellers to trade shares in public companies.
You can buy stocks by opening a brokerage account with a reputable brokerage firm, depositing funds into the account, and placing an order to buy the shares you want.
There are many different factors to consider when choosing which stocks to buy, including the company's financial performance, industry trends, and market conditions. It's also important to do your research and consult with a financial advisor if you're uncertain.
Dividends are payments made by a company to its shareholders, typically out of the company's profits. Dividends are usually paid on a regular basis and can be a source of income for investors.
A stock split is when a company divides its existing shares into multiple shares. For example, a 2-for-1 stock split would double the number of shares outstanding while cutting the price per share in half.
A market order is an order to buy or sell a security at the current market price. Market orders are typically executed immediately and are used when speed of execution is more important than price.
A limit order is an order to buy or sell a security at a specified price. Limit orders are used when the investor wants to control the price at which the trade is executed, and are not guaranteed to be filled.
A stop-loss order is an order to sell a security when it reaches a specified price. Stop-loss orders are used to limit losses if the price of a stock declines, and are typically placed below the current market price.
A mutual fund is a type of investment vehicle that pools money from multiple investors to invest in a diversified portfolio of stocks, bonds, and other securities. Investors buy shares in the mutual fund, and the fund's value is determined by the performance of the underlying assets.
A stock index is a benchmark that tracks the performance of a specific group of stocks. Examples of stock indices include the S&P 500, which tracks the performance of 500 large-cap US stocks, and the FTSE 100, which tracks the performance of 100 large-cap UK stocks.
Insider trading is the illegal practice of buying or selling securities based on non-public information that is material to the stock price. This practice is illegal because it gives insiders an unfair advantage over other investors.