Eli5: How is money made from stocks?

Question

I understand buy low and sell high, but then what?

If, say the S&P500, keeps growing there is no ‘peak’ to sell at. Do the gains compound? if so how? Or do you just hold it forever and sell when you want to get the money?

In: Economics

Answer 1

> Or do you just hold it forever and sell when you want to get the money?

Yes you basically hold until you need the money , the longer the better.

Invest when you are 20-30 and keep investing and the investment will grow over 30-40 years. You do not sell until you need the money .