What is the Stock Market?
The stock market, also known as equity market is where stock brokers and traders buy and/or sell stocks (also called shares), bonds, and other securities either through exchanges or over-the-counter markets. This market is one of the most important features of a free-market economy, as it provides companies with access to capital in exchange for giving investors a portion of ownership in the company. The stock market makes allows investors to grow small initial sums of capital into large ones, and to become wealthy without taking the risk of starting a business or making the sacrifices that often accompany a well-paid career.
The stock market is divided into two main sections: the primary market and the secondary market. The primary market is where new issues are first sold through initial public offerings. Institutional investors usually purchase most of these shares from investment banks. All other types of trading occur in the secondary market where participants include both institutional and individual investors.
Stocks are traded through exchanges. The two biggest stock exchanges in the United States are the New York Stock Exchange, founded in 1792, and the Nasdaq, founded in 1971. Today, below is a full list of the most used exchanges.
|New York Stock Exchange||United States|
|London Stock Exchange Group||United Kingdom, Italy|
|Japan Exchange Group – Tokyo||Japan|
|Shanghai Stock Exchange||China|
|Hong Kong Stock Exchange||Hong Kong|
|Bombay Stock Exchange||India|
|National Stock Exchange of India||India|
|SIX Swiss Exchange||Australian Securities Exchange|
|Australian Securities Exchange||Australia|
|Korea Exchange||South Korea|
|OMX Nordic Exchange||Northern Europe, Armenia|
|JSE Limited||South Africa|
|BME Spanish Exchanges||Spain|
|Taiwan Stock Exchange||Taiwan|