Stocks

Shares of ownership in a publicly traded company that can be bought and sold on stock exchanges like the NYSE or NASDAQ.

When you buy a stock, you own a small fraction of that company. Stocks are one of the most common investment vehicles for building long-term wealth, historically returning about 10% annually (S&P 500 average).

How Stocks Make Money

  • **Capital gains**: Selling shares for more than you paid
  • **Dividends**: Regular cash payments from company profits

Stock Categories

  • **Growth stocks**: Companies reinvesting profits for rapid expansion (tech)
  • **Value stocks**: Underpriced companies relative to fundamentals
  • **Dividend stocks**: Companies paying regular income to shareholders
  • **Blue chips**: Large, stable companies with long track records
  • **Penny stocks**: Low-priced, high-risk speculative shares

FAQ

How do I start investing in stocks?

Open a brokerage account (Robinhood, Fidelity, or Schwab), deposit funds, and buy shares. Most brokers offer fractional shares so you can start with any amount.

Are stocks a good investment?

Historically, the stock market has averaged about 10% annual returns over the long term. Stocks carry short-term volatility risk, so they're best suited for goals 5+ years away.