What is the stock market?

The stock market is like a specialty shop, where companies in the world offer shares of its company, to all potential buyers

Here comes the effect of supply and demand, the company can offer its shares at a high price, but if customers do not see the company attractive, not to buy Their shares, So They Began to decline in price, Until the buyer sees them attractive .

Or on the other hand can be a very well positioned and offer their shares at a high price, and yet, DESPITE the price continues to rise, many buyers will.

For a company to participate in the stock market, You have to make a public offer, i.e., potential buyers have access to information About how the company works, results, performance, position, in short, you need to be sure of who wants to invest in the company.

Then the investor can choose if held in that company or want to sell their shares.

The stock market is a market where investors buy and sell stocks. When we hear that a company has embarked on the bag that means for the first time the company will offer its shares public, this is Also known as primary market.

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We often hear in the news that the stock market rose or fell given country, and although it is part of the news each day to only a few people understand what it is that the stock market goes up or down.

First of all we must understand that the stock market is an indicator, which tells of the situation of a country whether political or social. When a country falls into recession, the stock market crash is inevitable, because investors no longer trust the companies within that country.

By the contrast, when the country begins to stabilize their business credibility increases, so the bag starts to rise.

How do we affect the stock market goes up or down?

The effect is not seen immediately, unless we are direct investors in the stock market immediately in which case they may lose money if their actions are devalued.

When the bag down, we say that investors may be losing money, so your purchases will decrease and then it affects us as sales began to decline. Besides the stock market crash also means companies have less liquidity (because shareholders have withdrawn their money) and if we add that sales are down, began to be staff cuts, reduced production, etc. Factors that affect virtually reach all families.

On the positive side, if the stock goes up, it means that investors have greater purchasing power, so auto sales, home, and other increases. For their part, companies have capital to invest, so that opens new positions, higher salaries, and more factors affecting positively.

It is more common than we realize these changes when the stock market remains constant, if today and tomorrow goes low (which is what normally happens) will not feel the effect.

Some economists prefer to make changes in the stock market as an indicator, if in a country the bag down suddenly, immediately investigate what is happening in that country.

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Ion Tou Joined: May 27th, 2020