What is the Stock Market? The stock market is a financial marketplace where investors buy and sell shares of publicly listed companies. When a company offers its shares to the public through an Initial Public Offering (IPO), individuals and institutional investors can purchase those shares and become partial owners of the company. The stock market provides a platform that connects buyers and sellers, enabling the trading of securities in a regulated and transparent environment. The primary purpose of the stock market is to help companies raise capital for business expansion while giving investors the opportunity to grow their wealth through capital appreciation and dividends. As companies grow and become more profitable, the value of their shares may increase, allowing investors to earn returns on their investments. However, stock prices can also decline due to economic conditions, company performance, market sentiment, and global events, making investing subject to market risks. The stock market consists of two main segments: the primary market and the secondary market. In the primary market, companies issue new shares to raise funds through an IPO. In the secondary market, investors trade existing shares among themselves on recognized stock exchanges. This continuous buying and selling determine the market price of stocks based on supply and demand.
