Stocks, also known as shares or equities, are units of ownership in a company. When a company decides to issue stocks, it is effectively selling ownership in the company to investors in exchange for capital to be used for growth and development. Individuals who buy shares in a company are referred to as shareholders, and they can make a profit by selling their shares if the company's value and performance improve.
Stocks are usually traded on stock exchanges, where buyers and sellers come together to trade shares with each other. The stock market is a crucial component of the global economy, as it connects companies with the capital they need to grow and investors with opportunities to make a profit.
The performance of stocks is often influenced by factors such as the overall health of the economy, changes in government policies, global events, and company-specific news such as earnings reports and product launches. Due to their potential for high returns as well as significant risks, investing in stocks typically requires careful research and analysis to make informed decisions.
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