What is the Stock Market?
Stock markets are exchanges in which companies that are seeking to raise capital offer to sell shares of their company to the public. These stock shares represent ownership of a portion of the company. The exact ownership depends on the type of shares purchased whether common stock or preferred stock. There are several differences between common stock and preferred stock.
These differences deal with voting rights at shareholders meetings and dividend payments. The most well-known stock market is the New York Stock Exchange, also known as the NYSE. The next most well-known is the NASDAQ.
One misunderstanding is the Dow Jones Industrials Average; this is not a stock market, but an index, or a measure of the value of a group of stocks or different markets such as oil or technology. As the name indicates, the Dow Jones is an average of a select group of industrial stocks. These stocks represent core American companies such as Dow Chemical and Intel and can use the Straddle Trader Pro 2.0 Software. Another major index is the Standard and Poor’s 500 (S&P 500), which is an index of 500 key stocks from the NYSE. The indexes are used to measure the performance of the stock market or the particular market sector.