Stock Market for Beginners: What is the stock market?

The financial world is a scary place, and the stock market is the financial capital. People are yelling familiar words in strange ways, like "securities" and "shares", but nobody is talking about keeping things safe or sharing anything. First they say it's a "stock market" and then all of a sudden it's a "stock exchange". It makes no sense. Nobody in their right mind would want to be involved with such a place.

Yet you've heard the rumors. And now you're curious. Strange things have been said to happen in this "stock market". Average Joes come and then go as millionaires. That sounds lovely until you remember the others who leave, tears streaming, as they've lost everything. No. It's not Las Vegas.

Of course, we're just kidding when we talk about the stock market as if it had a physical location. In reality, the stock market is the place where stocks are purchased, sold, and traded. That's why it is also sometimes called a stock exchange. And thanks to wireless Internet technologies, the stock market can exist almost anywhere.

So, what is a stock? Is it anything like a sock? Well, stocks are a bit less tangible than your socks. Stock, quite simply, represents ownership of a company. A stock represents one piece, or share, of that collective ownership.

Just as there are different kinds of socks - like cashmere or cotton - there are different kinds of companies that you can purchase stock from. Success in the stock market is all about finding the right companies to invest in and determining the right time to purchase their stocks.

See? That wasn't too confusing, right? You now know what the stock market is and how it basically works. Next, The Gorilla will share how to determine what stock is your best fit.