Stock market crashes

Friday, 22 June 2012

Posted by: Edgar Allan Poe, MD

A stock market is the market that people use to trade (= buy and sell) shares, which are like small pieces of the company that a person can own. The value of the share depends on how many people want to buy it and how many people are selling it.

If many people want to buy a stock, the price will go up. If there are more sellers than buyers, the price will go down.

People usually trade shares in stocks through a broker. A broker or stockbroker is a person who buys or sell stocks for his customers on the stock market. A broker can also help customers make good choices in stocks. Most brokers have recommendations for most of the stocks, based on the information about companies and what is expected from them. Brokers usually recommend customers to BUY (good expectations - buy the stock if you don't have it), HOLD (neutral expectation - if you have the stock, don't sell it yet) or SELL (low expectation - sell the stock if you have it).

The most important stock markets in the world include:

  • NYSE (New York Stock Exchange) - USA
  • NASDAQ (stock market for mainly technology shares) - USA
  • London Stock Exchange - UK

Tags: Business, IT