Researching Stocks for Investing

What is a Market?


What is a Market?
A market is a place to buy and sell stock, bonds, mutual funds, or a number of other financially based 'securities.' Without a market, there would be no way for the average person to buy or sell shares of stock. 

What is a Stock Index?
In 1896, the editors of The Wall Street Journal took the 12 companies they felt best represented the United States economy and put them together in an index. Their thinking was that, when the index goes up or down, those paying attention would get an idea of how the economy overall was doing. Thus, the creation of the stock market index was created. The stock market's major indices are:

  • Dow Jones Industrial Average-Consists of 30 Blue Chip Companies
  • Standards and Poor's 500 (S&P 500)-Consists of 500 Large Cap National Companies
  • NASDAQ-Consists of the world's largest global exchange with 24 markets, 3 clearing houses, and 5 central securities depositories.

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