How does the stocks business works?

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  • How does the stocks business works?


Answer #1 | 22/12 2013 08:56
SK8TER DUDE, You could fill a library with books about buying and selling stocks. I would suggest you look up Investopedia they have good tutorials for Investing 101.
Positive: 84 %
Answer #2 | 22/12 2013 09:11
Yes. The most important thing for you to know is NEVER trust anyone with a "stock tip" regardless how amazing it sounds. Stock brokers are salesman. Their job is to sell you a stock. Always do your own homework. And the most important piece of info (IMO) is what the stock brokers don't want you to know...The price of a stock has only little to do with the real value of a company. Each public company has a limited number of shares. If there are more shares for sale than there are buyers, the price of the stock goes down. If there are more buyers than there are shares available, the price of the stock goes up. So ultimately, the price of a stock goes up and down on a daily basis due to the law of supply and demand. Price fluctuations very very rarely reflect the actually value of a company. So this is why I say never listen to "stock tips". If a person or company already owns a bunch of shares of a company, they can drive the price up themselves by creating demand. And they create demand by giving "stock tips". The more "stock tips" they give, the more demand for a stock there is, and the higher their own share prices go. Sound like fraud? Well it is. However, a broker or private citizen can always hide behind their "opinion". Lastly, you don't make money buying stocks. You only make money selling them. And also remember that most people lose money in the stock market. It's a shady business filled with sharks. No one is your friend in the stock game. I would recommend trying out a stock market simulator before investing any real money. BUYER ALWAYS BEWARE!!!!!
Positive: 78 %

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