A stock market is a group of buyers and sellers of stock that represent an ownership in a company. The first stock market or equity market was created in Amsterdam when the dutch East India Company was first traded publicly. To raise funds, the company sold stock and paid dividends to shareholders.
Today the term stock market is used to refer to one or more indexes such as the S&P 500 or the Nasdaq. There are thousands of stocks on the market today which makes it nearly impossible to track. Indexes have a specific criteria that they use to choose certain stocks that are a representative of the entire market.
At the time of the writing of this article, the stock market has been on a roller coaster ride. The market is currently on the way back up after some deep lows depending on the company. Many people wonder why the market is rising under our current economic circumstances with the unemployment rate at a record high.
I don’t pretend to know exactly why the market is moving up, no one knows exactly. I believe it has something to do with the low prices and talks of the U.S. economy opening up.
Investors are bargain shopping in the market, now may be a good time to make a purchase if a stock has been over priced, EFT’s and Index funds appear to be bargains too.
Companies like MasterCard and Visa, it depends on your budget and how much you have allotted to invest, on the other hand what goes down is bound to go up. If you’re looking for information on a particular stock, try Yahoo Finance.
It’s best not to try to time the market, you’ll never know when you’ve reached the bottom. Dollar cost averaging on a weekly or monthly basis will help you sleep at night.
As always, I’m not a financial advisor, please seek professional help before starting to invest.