To understand how stock trading works, it is import to first of all realize that its actual name is quite misleading.
Stocks are not actually "traded"; they are bought or sold.
At any given moment, you can unload a stock that you want to get rid of; someone out there will surely buy it for the right price.
Likewise, you can purchase any stock that you have an interest in - as long as you have the necessary funds to pay for its current going rate.
And that is the key to trading stocks: the concept of supply and demand.
The Stock Exchange The buying and selling - or "trading" - of all stocks occurs on stock exchanges.
These are places where people who would like to sell or purchase stocks get together in order to do so more efficiently.
There are many stock exchanges around the world; some famous ones include the New York Stock Exchange, the Tokyo Stock Exchange and the Chicago Stock Exchange.
When most people think of the stock exchange, they picture scenes like those found on the floor in New York: traders running frantically around, gesturing wildly and a whole lot of chaos in general.
Most of the people found on the floor of the NYSE are market makers, stockbroker and other specialists whose primary purpose is bringing buyers and sellers together at the exchange.
Traditionally, this type of arrangement was the only one available for stock market transactions; in modern times, though, there are alternatives.
Electronic exchanges use complex, cutting edge computer networks to complete all of their transactions.
In lieu of stockbrokers and market makers, electronic exchanges like the NASDAQ are comprised of a series of computers.
It is not surprising, then, that images of these types of exchanges are not popularly shown; they simply do not evoke the kind of frenzied pace that an exchange floor does.
Stock Brokers and Trades Whether it is via a stock exchange floor or through an electronic one, trades still must be facilitated by professional stockbrokers.
Average stock buyers and sellers do not have direct access to the exchange; that would introduce far too much chaos into an already volatile system.
Instead, brokers are used as go betweens for investors and the market.
They enforce the rules of the stock exchange.
They make sure that any given investor has the funds necessary to make the purchase that they are interested in.
They also guarantee that a fair price is adhered to, in order to keep the market from spinning out of control needlessly.
Top paid brokers actually receive a price from an investor and run it down on the exchange floor, attempting to broker a deal.
Electronic stockbrokers, like those found online, work to allow investors to make online trades.
They act as the go between, in lieu of their human counterparts.
Like their human versions, they enforce the rules of the stock exchange and follow the movements and fluctuations of the market - as well as its demands.
While electronic stockbrokers generally supply similar information to that offered by human stockbrokers, they require more deduction on the part of the investor.
Stocks are not actually "traded"; they are bought or sold.
At any given moment, you can unload a stock that you want to get rid of; someone out there will surely buy it for the right price.
Likewise, you can purchase any stock that you have an interest in - as long as you have the necessary funds to pay for its current going rate.
And that is the key to trading stocks: the concept of supply and demand.
The Stock Exchange The buying and selling - or "trading" - of all stocks occurs on stock exchanges.
These are places where people who would like to sell or purchase stocks get together in order to do so more efficiently.
There are many stock exchanges around the world; some famous ones include the New York Stock Exchange, the Tokyo Stock Exchange and the Chicago Stock Exchange.
When most people think of the stock exchange, they picture scenes like those found on the floor in New York: traders running frantically around, gesturing wildly and a whole lot of chaos in general.
Most of the people found on the floor of the NYSE are market makers, stockbroker and other specialists whose primary purpose is bringing buyers and sellers together at the exchange.
Traditionally, this type of arrangement was the only one available for stock market transactions; in modern times, though, there are alternatives.
Electronic exchanges use complex, cutting edge computer networks to complete all of their transactions.
In lieu of stockbrokers and market makers, electronic exchanges like the NASDAQ are comprised of a series of computers.
It is not surprising, then, that images of these types of exchanges are not popularly shown; they simply do not evoke the kind of frenzied pace that an exchange floor does.
Stock Brokers and Trades Whether it is via a stock exchange floor or through an electronic one, trades still must be facilitated by professional stockbrokers.
Average stock buyers and sellers do not have direct access to the exchange; that would introduce far too much chaos into an already volatile system.
Instead, brokers are used as go betweens for investors and the market.
They enforce the rules of the stock exchange.
They make sure that any given investor has the funds necessary to make the purchase that they are interested in.
They also guarantee that a fair price is adhered to, in order to keep the market from spinning out of control needlessly.
Top paid brokers actually receive a price from an investor and run it down on the exchange floor, attempting to broker a deal.
Electronic stockbrokers, like those found online, work to allow investors to make online trades.
They act as the go between, in lieu of their human counterparts.
Like their human versions, they enforce the rules of the stock exchange and follow the movements and fluctuations of the market - as well as its demands.
While electronic stockbrokers generally supply similar information to that offered by human stockbrokers, they require more deduction on the part of the investor.