Investors buy shares of stock in the hopes that the company selling those shares will grow to become more valuable over time, thereby increasing the price of each share of stock. Stock prices are determined by the economic law of supply and demand, and their prices often fluctuate daily based on changes in investor demand.
What is a stock exchange-traded fund (ETF)?
The term stock exchange-traded fund (ETF) refers to a security that tracks a particular set of equities. These ETFs trade on exchanges the same way normal stocks do and track equities just like an index. They can track stocks in a single industry or an entire index of equities.
Are Stock ETFs a good investment?
The original purpose of investing in ETFs was to meet long-term goals, but they can be traded like any other stock in that investors can short or buy on margin. Since they give investors access to a broad range of equities or indexes makes these (and others), stock ETFs are generally considered very diversified assets.
When was the first stock market created?
The first modern stock exchange was created in Amsterdam in 1611, and investors could initially only buy and sell shares of the Dutch East India Company. The first U.S. stock market was the Philadelphia Stock Exchange, which was founded in 1790. The New York Stock and Exchange Board, the precursor to the NYSE, was formally constituted in 1817.
