If you ever look at business news or business shows on television, you would no doubt hear such words or phrases as "stock market," "stocks," "trading," or "stock market trading." What are such things, and why are they important? To answer such questions, here is an overview of exactly what stock market trading means.
The corporation issues physical documents termed shares to make out capital from the people. There shares are then buyed or selled between people same on different prices like trading coffee, sugar, wheat and rice in commodity market. This process of exchanging the stocks is called the stock trading and the market place used for trading purpose is called trading exchange. This may be physical like office, hall etc. or virtual like online.
Trading Process - Stock trading takes place as one sells his stocks and as the other buys them. Usually buyers and sellers of stocks meet in stock exchanges and there they agree on the price of the stocks. The actual stock trading happens on a trading floor-the one usually shown on TV when news on stock trading is reported. Here investors raise their arms, throwing signals to each other. That auction-like picture of a stock trading is the traditional way stocks are traded. It's called "open outcry" since the traders cry out their bids.
The Key Players in Stock Trading: Stock trading participants vary, from those who sell little individual stock investments to large institutions which trade collective investments, pension funds, hedge funds, mutual funds, and more. Large investors might be insurance companies, banks, and other such big companies.
In order to encourage growth in the economy stock trading is a necessity. Stock trading helps companies resolve financial issues and it helps them raise capital. Saving capital and investing it in more profitable businesses is guaranteed by stock option strategy. Knowledge in option trading is a great benefit in stock trading.
Trading Stocks Online - The Internet has made it very convenient for us to do many things that we once had to do over the phone or in person. These things include but are not limited to shopping, conferencing, and communications and we can do these things anywhere we can log on. Now you can do the same with stock trading and this has opened up the market to a whole new set of investors. You can get real time valuations of your investments any time you want.
Every share of common stock represents a proportional ownership, or equity, in a company. If a company has only one share of common stock and an investor owns it, the investor owns the entire company and is entitled to one hundred percent of the company's profits. If a company has 100,000 shares of common stock and an investor owns one of them, then the investor owns.
In simple terms, stock market trading is the voluntary buying, selling or exchange of company stocks and their derivatives. Stocks refer to the capital raised by a corporation by means of issuing shares. These shares are traded in a stock market in the same way commodities such as coffee, sugar, wheat and rice are traded in a commodity market. The physical or virtual marketplace for trading shares is called the stock exchange. The wise investor will learn option trading, and the best option strategy for various market conditions, in order to derive greater benefit from stock trading.