Everything about the stock market for beginners

The stock market awakens the imagination of those who are tired of saving Everything about.

But it also raises countless questions for those who don’t know the exchange.

If you identify with the latter group, you know you’re not alone.

In Brazil, the investment culture is still little promoted:

Due to fear, low income or lack of knowledge, less than 1% of the Brazilian population invests in shares.

The number reflects research carried out by the Credit Protection Service (SPC Brasil).

And by the National Confederation of Shopkeepers (CNDL), launched in March 2016.

It shows that only 0.40% of the 804 Brazilians interviewed invest in the stock market.

The main justification is that it is an “investment for the rich”.

The truth is, you don’t need to be a millionaire or an expert to understand the basics of how the stock market works.

Furthermore, discovering how the stock market works can be the key to making more profitable investments.

And even better understand the ups and downs of the Brazilian economy.

Interested? Therefore, check below everything you need to know to become an investor.

What is a stock exchange?

The stock exchange is a trading environment in which investors can buy or sell securities issued by companies. Whether with public, mixed or private capital. This process is mediated with the help of commercial correspondents through brokers. To get a clearer idea of ​​what a stock market is, it is possible to make an analogy. Imagine a fair where manufacturers display their products for customers to buy. The stock market works in a similar way: If you decide to sell a share and another investor is interested in buying it, it will be the meeting point between you. The main objective is to create a safe and organized environment for these negotiations. This way, you ensure that investors receive the shares they purchased efficiently and safely and that transactions are quick and convenient. The year 2020 could offer great opportunities for the stock market. Access the post “Best investments for 2020” and find out more details.

How does the exchange work?

For those who don’t know how the stock market works, it’s easy to understand. A company decides to go public and make shares available in exchange for resources. Then, stakeholders can become “partners” of the company by purchasing small “slices” of the business. After the company’s IPO (Initial Public Offering, in Portuguese), shares begin to be traded and investors make buy and sell offers. This movement shapes the primary market, which helps define a relationship between demand and supply for securities. The lead investor, for example, may want to sell his shares because he believes the price will fall (or simply because he needs money). While another investor may choose to buy them believing that the value will increase. If this happens, the main investor will issue an order to sell his shares, stipulating the value he intends to obtain in exchange for them. The brokerage system then sends a stock order to the stock exchange. In the meantime, the second investor interested in purchasing a share can submit a purchase order (for the amount they wish to invest). It does this through your broker, which will automatically connect to the system. When the buy and sell order reaches the exchange with the same value, the transaction is closed. This is what we call the secondary market. This process, contrary to what it may seem, is not slow.

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Forget the screams you saw in movies like The Wolf of Wall Street. The stock exchange is the environment where shares and other financial assets are traded. It connects investors who want to buy or sell company securities. For beginners, understanding how it works is essential. The main function of the exchange is to facilitate share trading, ensuring transparency and security. Shares represent small parts of a company’s capital. When you buy them, you become a partner and can profit from the company’s results. The main indices, such as Ibovespa, reflect the performance of the largest listed companies. They help you understand general market behavior. To get started, you need to open an account with a broker. The broker is the intermediary between you and the exchange, allowing you to carry out operations. Investing in shares can generate good returns, but it involves risks. Therefore, it is important to study and diversify your portfolio. In addition to shares, the exchange also offers other assets. You can invest in real estate funds, ETFs and even commodities like gold. Use educational tools and content to learn more. Simulators are great for practicing before investing with real money. With patience and discipline, it is possible to take advantage of the opportunities on the stock market. Remember to only invest amounts that you can hold for long periods.

Currently, the main exchanges in the world are being traded online, using computers.

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