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What the stock market is
The stock market is a network of exchanges where people trade ownership in companies. When a company sells shares to the public, those shares can then be bought and sold among investors for as long as the company stays listed.
There is no single building where this happens. The market is really the sum of many exchanges and the brokers that connect ordinary investors to them, all operating under rules meant to keep trading fair and orderly.
How prices are set
Prices come from supply and demand. At any moment there are buyers willing to pay a certain amount and sellers asking for a certain amount. A trade happens when those two sides meet, and the most recent trade becomes the quoted price.
This is why prices move constantly during the trading day. As opinions shift about a company's prospects, so do the prices people will accept, and the quote updates in real time as new trades occur.
💡 A share price is just the latest agreed price:The number you see is simply what one buyer and one seller most recently agreed on for a single share. It is not an official valuation, and it can change from second to second as new orders arrive.
What happens when you buy
When you place an order through a brokerage, your broker routes it to the market to be matched with a seller. Once matched, the trade is recorded, the shares move into your account, and the cash moves out. This usually happens in a fraction of a second.
You do not need to know who is on the other side of the trade. The exchange and your broker handle the matching, settlement, and record keeping, so from your seat it feels as simple as tapping a button.
Frequently asked questions
Who actually owns the stock market?
No single person or company owns it. It is made up of exchanges, which are themselves businesses, along with brokers, market makers, and millions of investors. Regulators set rules to keep trading fair, but ownership of the shares belongs to the investors who hold them.
Where does my money go when I buy a stock?
In most cases it goes to another investor who is selling the same shares, not to the company. The company only receives money when it first sells shares, such as in an IPO or a later share issue. After that, you are trading with other investors on the secondary market.
Why do stock prices change so much?
Prices reflect the constantly shifting balance of buyers and sellers. As news, earnings, and opinions change, people adjust what they are willing to pay or accept, and the quoted price updates with each new trade. This is normal and happens throughout every trading day.
Do I need a lot of money to use the stock market?
No. Many brokerages have no minimum to open an account and allow fractional shares, so you can start with a small amount. The mechanics of buying are the same whether you invest a little or a lot.
Related tools and pages
These are for learning. Any calculator here shows example scenarios, not predictions of future prices.
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