Tuesday, October 26, 2010

Stock Definition

Stock: "a type of security that signifies ownership in a corporation and represents a claim on part of the corporation's assets and earnings. 


A holder of stock (a shareholder) has a claim to a part of the corporation's assets and earnings. In other words, a shareholder is an owner of a company. Ownership is determined by the number of shares a person owns relative to the number of outstanding shares. For example, if a company has 1,000 shares of stock outstanding and one person owns 100 shares, that person would own and have claim to 10% of the company's assets." (investopedia)


How do you make money from trading stocks?
The simplest example: You buy 100 shares of XYZ for $1.00. In two weeks, you look back at your portfolio, and see that the price of the underlying stock has gone from $1.00 to $2.00. You then sell all 100 shares for $2.00. Your return on investment would be 100%. haha


Simple enough right?
No, it's a lot harder than that. But, I'll touch up on the rest later. 



15 comments:

  1. This is how I payed for college

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  2. I wish it was easy. Too bad DJSP is doodoo.

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  3. I have stock in stock thats how cool I am but I think that makes me poor right now haha
    thanks for the love on my blog too bro

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  4. How do you even know that you well be able to sell? haha

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  5. I need to get into the stocks game

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  6. stocks can make you a lot of money

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  7. Good to start with the definition first :)

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  8. I still have some money tied up in stocks, kinda just waiting for them to stop sucking

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  9. I feel bad because I never invest

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