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There are hundreds of markets around the world in which to trade. To avoid confusion, the novice investor should first consider the two largest markets in the United States, The New York Stock Exchange (NYSE) and the North American Securities Dealers Automated Quotation System (NASDAQ). When buying stock, an investor actually owns part of a public corporation, and this fact should be what forces the potential investor to research a stock diligently before buying.
Common stocks are shares sold initially by a corporation. They are then traded among investors. They earn dividends (part of the corporate profits) and they go up and down in value. There are no guarantees on performance on common stocks, but, historically, common stocks have produced a better return than most other market investments. There are also preferred stocks which are similar to common stocks except that they offer reduced risk, that is, they aren't as volatile, and dividends are paid before those paid on common stocks. When reading stock tables or listening to people speak of hot stock investments, the novice investor will mostly hear of common stock purchases. In learning about trading, it's a good idea to use the world wide resources of the internet and check out the glossary on the NYSE.
To research a stock, several resources are available. Investors often subscribe to the Wall Street Journal or The Investor's Business Daily. Both these publications are delivered to mailboxes, but they are also available online for a much lower cost. The online editions feature clickable hypertext links that give stock quotes as well as corporate news and opinions. Stock charts are also easily obtained using the online editions.
One can also research stocks using hundreds of online investment sites. Here are several to follow for more information:
Reading the Stock Tables
What's happening in the market? You can learn about trading in general, or you can follow a specific stock by doing your diligent research through sites similar to the links above. However, there will be times when you simply follow the stock tables that you find in the business and investing section of your daily newspaper. Reading stock tables is not difficult, but it requires some basic knowledge. The following link is from the Florida Times Union. Learn the basics and you're on your way.
