A long time ago, humans ran businesses with simply their cash. The companies they ran were tiny and that they grew the companies solely with their own profits. However, not all businesses are designed together with your own cash. What if you needed to create a brand new mill that prices over 1,000,000 dollars? Banks will not lend cash for young firms and your friends will not have that a lot of.
In the 15th-16th century because the Europeans started exploring Asia and Americas, the massive explorers felt they required lots of cash and their kings weren’t providing them any longer. The rich guys demanded lots of interest. Thus, they felt they have to boost cash from a bunch of people. Thus, in 1602, the Dutch archipelago company became the primary company to issue shares of its company within the Dutch capital stock market and acquire listed on a nonstop basis.
In India, it absolutely was 1600s, the Dutch, British, and French governments all gave charters to firms with archipelago in their names. On the cusp of imperialism’s division, it looks like everybody had a stake within the profits from the East India and Asia except the folks living there. Ocean voyages that brought back product from the East were very risky – on prime of geographic region pirates, there have been the lot of common risks of weather and poor navigation. Once the archipelago firms fashioned, they modified the method business was done. These firms had stocks that may pay dividends on all the take from all the voyages the businesses undertook, instead of going voyage by voyage. These were the primary trendy joint stock firms
what is Stock Market-
The stock market is an everyday term we use to talk about a place where stocks and bonds are “traded” – meaning bought and sold. For many people, that is the first thing that comes to mind for investing. The goal is to buy the stock, hold it for a time, and then sell the stock for more than you paid for it
What are Stocks?
Stocks are units of ownership in a company
Companies sell stocks to get money to-Research better ways to make things
Create new products
Improve the products they have
Hire more employees
Enlarge or modernize their buildings
How it works?
When you buy stock, you become a shareholder, which means you now own a “part” of the company. If the company’s profits go up, you “share” in those profits. If the company’s profits fall, so does the price of your stock. If you sold your stock on a day when the price of that stock falls below the price you paid for it, you would lose money in the stock market, prices rise and fall every day. When you invest in the stock market, you are hoping that over the years, the stock will become much more valuable than the price you paid for it…