Why Does Stock Market Exist?

Why Does Stock Market Exist?

The stock market is a pool of opportunities. It provides companies a chance to raise capitals for businesses through selling shares to the investing public, promote business activity benefiting economic sectors such as agriculture, commerce and industry, expanding product lines and acquire other necessary business assets through acquisitions.

The stock market also offers investing in shares open to both large and small stock investors not requiring huge capital outlays but can limit to what that person can afford and buy providing them with shares of the same companies as large investors.

If talking about the literal meaning, Stock market is a unique place that deals with the stocks, shares and equities. Stocks and shares are issued when there’s a need arises for funds. These shares are issued to general investors. These funds are either issued by the private or mid level corpo0rations for business expansion or used by the government in the augmentation plans.

All the investors who invest in the stock markets, usually shares the profits and loss. Functioning of a feasible stock market is regulated with an efficient team of brokers, sub-brokers, portfolio managers, and investment advisors. Government introduces the statutory body that regulates the functioning of the stocks and observe the performance of the stocks of more than thousand companies listed in the stock market.

The stock market can be a risky financial trade system but with prior knowledge of how it works and how important its contributions are, trading here can be an opportunity not only for self beneficiaries but also for your country’s economic growth.

The problem with the stock market lies in its nature of volatility. This is the reason that pushes various hurdles before the investors. Therefore it’s always advised to request expert services from the stock trading experts before purchasing stocks of various companies.

Stock market has a secondary market portfolio where share brokers accumulate stocks of different companies listed on stock exchange on corporate and investment companies.

Before investing in any potential share market you need to get good consultation about the pros and cons of the stock trading amenities, regulations of the stock and health check of the stocks of the particular company or corporation.

Stocks can go down, and stay down for many years. They can become overpriced and underperform for a decade or several decades. The public is said to have learned that stocks must always outperform other investments, such as bonds, over the long run, and therefore, long-run investors will always do better in stocks.

Evidence also exists that investors do largely think this. But again, they have gotten their facts wrong. Stocks have not always outperformed other investments over decades-long intervals, and there is no reason to think they must in the future.

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