Maybe any of you ask, what is meant by stock? How does it work? Let’s get acquainted.

Have you ever thought to have a business? Let’s say you want to have a business in the form of a store. What can you do to be able to have the store?

If you have capital, then you can buy or lease a building and purchase of goods for sale. If you are new stores, of course there are certain risks, such as your store has not known by the public. This means that you have not visited the store a lot of buyers.

Then, as an alternative, why not try to buy other stores that had already been standing? You can choose to choose which store you want to buy, and of course you’re going to choose a store that seems to have been well known and best-selling, is not it?

If so, then the money you pay into the store owner is usually worth the price of the building (if building is owned their own stores) and the goods sold therein. In other words, you have purchased the ownership of the store where you purchased the capital.

Small fragments
Please note, in the business world not only stores that can provide benefits. There are businesses that do not form too many stores that can provide benefits. Business usually in the form of business entity, or popular terms: the company. Same with shops, corporate ownership can also be purchased. So you can choose which companies about always profitable in the past year, and you can buy property (capital) of the company.

Different from the store, the capital of a company is generally much larger than the capital of a store. For example, the capital of the store you want to buy may be $ 30 million, but the capital of the company you want to buy can be reached $ 300 million.

The problem is, not everyone has cash $ 300 million. Maybe people just have a $ 3 million, so this means he only got possession of one percent of the value of the company’s ownership. But how could so he could buy a property that only one percent of it?

By law, was made a rule: The company’s ownership is divided into small fragments, called the stock. For example, ownership of a company valued at $ 300 million was divided into shares which rated the stock with $ 1,000. Thus, if you only have $ 3 million, then you can only buy 3000 shares.

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