What is the stock market?

A stock or share basically means the ownership interest in a company, including its assets or profits. The company grants such property because it needs money to cover its costs or expand its business. And this financing can be debt financing (borrowing money) or equity financing (sale of shares).

Debt financing would require the company to repay the loan with interest, whereas in equity financing there would be no interest and the probability of not paying the money back at all! In addition, in the event of bankruptcy, the risk is distributed among a large number of shareholders.

So where can a company find people who want to buy its shares? In the stock market. It acts as a common platform for buyers and sellers of shares. And how does an investor buy the desired shares if he cannot be present on the stock exchange or does not know which shares to buy?

Online trading comes to the rescue, and a stock broker can help too. An online stock broker or stock broker keeps up to date on the stock market and has experience trading stocks.

Therefore, it guides the investor on how and where to invest, for a brokerage fee.

Choosing the right stock broker is crucial as he would be the one to decide on an investor’s hard earned money. A trusted stock broker acts as an honest partner for the investor on his or her journey in the stock market. He must be trustworthy and able to get higher returns on investments. An online stock broker or stock brokerage firm should provide quality services to its clients, such as reliable and fast market information, convenient trading tools, and most of all, a reasonable brokerage fee.

Stock prices are constantly changing, and an investor would need to buy shares at a low price and sell them at a higher price to earn higher returns. For this, a keen eye on stock indices is required to follow the performance of various companies that you are interested in buying shares of. The stock index is a group of the companies with the best performance listed on the respective stock market, and whose performance represents the performance of all companies and, in turn, of the sector in general to which they belong.

But an important element that contributes to the stock price is the news. National and international problems such as terrorism, war, crime, fraud, etc. stock prices deteriorated. This happens because the uncertainty of the situation makes people refrain from investing, which in turn affects business. The fear of losing money results in a drop in stock prices.