The Stock Market
A brief introduction to get you
started
Terms
Stock = certificate of ownership in a
corporation
part-owner of that corporation
Corporation
Legal entity owned by stockholders each of whom
faces limited liability for a firm’s debts
Publicly held corporation
Many shareholders who can buy/sell on the open
market
stock facts
If you sell stock for more than you pay for it =
capital gain
If sell it for less = capital loss
Largest and most established companies
trade on the New York Stock Exchange
All others on the Nasdaq or Amex
Definitions
The Dow Jones Industrial Average
30 large companies in various industries
Shows how certain stocks have traded daily since 1896
Companies change in order to be a representative of the
whole market
S&P 500 (Standard and Poor’s 500)
Tracks the price changes of 500 different stocks as a
measure of overall stock market
Most stocks are on the NYSE