The stock market functions as a platform for buying and selling shares of publicly-traded companies. Investors trade these shares through exchanges, such as the New York Stock Exchange (NYSE) or the Nasdaq. Here's a simplified explanation of how it works:
It's important to note that this explanation provides a general overview, and the functioning of the stock market involves more complex mechanisms, regulations, and other aspects that professionals analyze in greater detail.
Overall, the stock market functions as a marketplace for buying and selling shares of publicly-traded companies. It provides a platform for investors to participate in the ownership and trading of stocks, which represent ownership stakes in companies. The stock market is influenced by various factors, and its prices fluctuate based on supply and demand dynamics, company performance, economic indicators, news events, and investor sentiment. Investors can adopt different strategies, including long-term investing or short-term trading, depending on their goals and risk tolerance.