The stock market is a system where buyers and sellers trade shares (or stocks) of publicly listed companies. It provides a platform for companies to raise capital by issuing shares to the public, and for investors to buy and sell these shares. The stock market helps in determining the value of a company based on supply and demand for its shares.
The main types of stock markets are:
Primary Market: Where companies issue new shares to the public for the first time through an Initial Public Offering (IPO).
Secondary Market: Where existing shares are bought and sold among investors. This is where most trading occurs (e.g., the New York Stock Exchange, NASDAQ).
The stock market plays an essential role in the economy by helping companies grow, providing liquidity for investors, and reflecting the overall health of the economy. Stock prices can go up or down based on factors like company performance, economic news, or global events.
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