What Is a Stock?
Why Does the Stock Market Exist?
shares outstandingauthorized shares
How To Make Money With Stocks
- Dividends: Some companies share a portion of their earnings with shareholders in the form of dividends, often paid quarterly as cash. However, not all companies pay dividends—many are still growing and reinvest their earnings to expand market share.
- Asset Appreciation: This occurs when the value of the shares you own increases over time. The classic investment advice is “buy low, sell high.” For a stock to appreciate, there must be more buyers than sellers, usually because the company is expected to perform well in the future.
How To Pick Stocks
Fundamental Analysis
- The balance sheet, which shows assets, liabilities, and equity.
- The income statement, which details revenues, expenses, and profits.
- Quarterly and annual reports filed with regulators, providing updated financial data.
Qualitative Analysis
- How the company makes money.
- Its competitive advantages or “moats.”
- The quality and experience of its management team.
- Industry trends and market positioning.
Trend and Sector Analysis
How To Buy Your First Stock Using Robinhood
Step 1: Create and Fund Your Account
Step 2: Search for the Stock
Step 3: Understand the Stock Page
- Market Cap: Total company value, automatically calculated.
- Dividend Yield: The annual dividend as a percentage of the stock price.
- Volume: How many shares have traded recently.
- News Feed: Latest news affecting the stock price.
- Analyst Ratings: What professional analysts think—for example, 95% of analysts might rate Microsoft as a “buy.”
- Bullish vs. Bearish Thesis: Arguments for and against the stock’s future performance.
- Earnings Reports: Whether the company has been beating or missing earnings expectations.
Step 4: Place Your Order
- Market Order: Buys or sells the stock immediately at the best available price.
- Limit Order: Sets a specific price at which you want to buy or sell. The order only executes if the stock reaches that price.