Constant reaction to the Stock Market when you're a beginner:
The Stock Market is a constant volatile market. Beginners Guide to the Stock Market covers everything you would need to understand about the basics of stocks. The book is a quick read and through that the author tries to be concise on the topic of stocks. The Stock Market is a complex topic and needs constant learning about how to manage stocks, selling them and buying them. This is a beginners book, therefore not in-depth as other readers would prefer.
The main topics where about market capitalization, Introduction to the Nasdaq 100, Index Funds, Exchange-traded funds, Dow Jones Industrial Average (DJIA), S&P 500 and common mistakes beginners make when trading for the first time.
Right now, I'll give you an overview of what I learned:
Market Capitalization: determines how much a company is worth ($ total dollar value) based on all outstanding shares or total value of all a company’s shares of stock.
Formula: Total number of shares allotted (outstanding) × Current Market Price of each share
Do not confuse outstanding shares with issued shares:
Issued Shares: number of authorized shares sold to and held by the shareholders of a company.
Stocks the company use to sell publicly to generate capita
Stock given to insiders as part of their compensation packages
Company issues a share only once; after that, investors may sell it to another investor.
Shares outstanding: all shares of a corporation that have been authorized, issued and purchased by investors and are held by them.
S&P 500: 500 U.S. stocks with the largest market caps weighted.
If Apple has a bad day, the S&P 500 will go down more than if Campbell Soup has a bad day.
Nasdaq 100: mostly tech companies. Apple, Google, Netflix, Amazon, Facebook and more. Index Funds: type of mutual fund or exchange-traded fund (ETF) whose holding track or match a particular market index. Exchange-traded Fund (ETF): type of fund that holds multiple underlying assets that trades on an exchange. Contain all types of investments including stocks, commodities, or bonds; some offer U.S. only holdings, while others are internationals.
You can buy or sell it all day long in your brokerage account.
Various ETF’s: The ETF that trades for the S&P 500 trades under the ticket SPY. ETF for DJIA trades under the ticket DIA. ETF for Nasdaq 100 trades under QQQ.
To be continued..