Stock Market Education
Successful investing in the stock market takes time and patience and most importantly requires a thorough stock market education. There are many different ways to trade stock and many valuable resources available to assist you, but without basic knowledge in the stock market, and how it works, you are far from a successful investing career.
The stock market is a private or public market for the trading of company stock and derivatives of company stock at an agreed upon price. The stocks are listed and traded on stock exchanges and the purpose of these exchanges is to facilitate the exchange of securities between buyers and sellers. There is no doubt that anyone can make money through trading and investing in the stock market, but stock market education and the right training is necessary to succeed.
When you decide to learn how to play the stock market game, you will first learn about two basic methods. These methods are referred to as technical analysis and fundamental analysis. Technical analysis studies price actions in the markets through the utilization of charts and techniques. The idea is to learn how to forecast price trends focusing only on price movements and not on the company’s financials. Fundamental analysis focuses on general economic conditions, business trends, and analysis of company filings and financial statements. Through obtaining a stock market education you will be able to determine which method you prefer so that you can trade stock efficiently. In addition to learning about fundamental and technical analysis you will also need to understand what it means to own stock. When you buy stock, you are actually paying for a small percentage of everything that the company owns. You are considered a shareholder or a stock holder and you own a small fraction of a corporation.
Your stock market education will also consist of an introduction to the various stock exchanges available for trading. The stock market in the United States includes the trading of securities that are listed on the New York Stock Exchange (NYSE), the NASDAQ, and the Amex. Only those stocks listed with each exchange may be traded and the purpose is to match buyers and sellers. The NASDAQ is completely electronic where all of the trading is completed over a computer network, unlike the NYSE that requires human contact and interaction to match buyers and sellers. You may also be introduced to the major European stock exchanges such as the Euronext, the London Stock Exchange, and the Deutsche Borse.
After obtaining a stock market education, the investor is required to establish a trading plan, method and the type of trading that they will participate in whether it is day trading or long term trading. Luckily there is something for every type of investor no matter how much money you have, and not matter how much time you have to devote to trading stock. The stock market is vital to our economy and is one of the most important sources for companies to raise money. It allows business to go public or to raise additional capital in order to expand. Start to learn about the stock market today so that you can participate in expanding the global economy and make some money for yourself in the meantime.