How does the stock market work?

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By The News Voice

Before learning how Stock Market works/operates

what does the stock market mean?

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The stock market is a designated market where the exchange of activities (buying & selling) and the issuance of shares (of publicly held companies) happens.

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So, How does  The Stock Market work?

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First, stock markets provide a regulated and secured environment for market participants to transact in shares and exchange securities at zero- to low-operational risk.

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Participants in the stock market range from individuals (retail investors) to big institutional investors (insurance companies, fund managers, pension funds, and banks)

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While it could be a bit complex, few important steps explain how the stock market works.

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 In the stock market, buyers place bids and sellers offer prices (asking price) for shares of stock.

A)

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 When the bid eventually equals the ask, a trade occurs.

B)

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In the stock market, the term “bid-ask spread” is referred to as the difference between what buyers pay and sellers accept.  Also, a smaller bid-ask spread could show more liquid security.

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Now, you know what is Stock Market.

So go on,  Invest and Earn!