TABLE OF CONTENTS The Stock Market Is Not a Place 4 There Is More Than One Stock Exchange 6 Owning a Stock Is Owning a Piece of a Company 8 The First Stock Exchange Was Founded in 1602 10 The Stock Market’s Purpose Is to Raise Money 12 Many People Work in the Stock Market 14 There Is No Set Price for Stocks 16 Stock Averages Show How Strong the Market Is 18 The Value of the Stock Market Always Changes 20 There Are No Guarantees in the Stock Market 22 The Stock Market Can Crash 24 Laws Make Sure the Stock Market Is Fair 26 Fact Sheet 28 Glossary 30 For More Information 31 Index 32 About the Author 32
1 THE STOCK MARKET THE STOCK MARKET IS NOT A PLACE IS NOT A PLACE The stock market is a term that describes buying and selling stocks It is not an actual place people can visit People do not buy stocks at a stock market the same way they would buy an apple at a grocery store People All of the stocks across the world communicate to buy and sell stocks 4 that are bought or sold in the world are part of a stock market The stock market is global People and 55 trillion Value of shares traded in the world stock market in 2013 The stock market is how we refer to the organized network of people who buy and sell shares in companies It is not a place you can visit such as a grocery store It is not limited to one country or region Companies that sell shares in the stock market need to raise money Investors buy those shares and the company gets the money it needs
SCRIPOPHILY Companies issue paper certificates for their stock Stock certificates show the number of shares that are owned by whoever has the certificate Stock certificates especially old ones are popular with collectors These old stock certificates are valuable even if the company no longer exists The study and collection of stock certificates is called scripophily Old stock certificates such as this one are valuable to collectors companies all around the world can buy and sell stocks An investor in Los Angeles can buy stock in a company in Beijing An investor in Tokyo can buy stock in a company in London When a company needs money one way to get that money is to sell stocks Investors or people who buy stock in a company will give the company money In return the investors own part of the company Companies that want to sell stock are listed on a stock exchange The stock exchange is the actual place where investors can buy stocks 5
