How do stocks work and how do you make a profit off of it??
In: Economics
Stock is a claim to ownership of a small part of everything the firm owns. Things, generally speaking, have value.
If a firm seems like it’s growing a lot, selling more stuff and the like, people may be willing to pay more for a share of ownership in the company than they did before this growth became clear. If you bought the stock earlier you may be able to sell it now for a profit.
In a nutshell, you can earn money by buying something, waiting until it becomes more valuable, and then selling it.
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