Understanding the Stock Market
The stock market is a platform where individuals and organizations buy and sell shares of companies. It's a way to invest in growth, dividend-paying stocks, or other assets.
- There are three main types of stocks:
- Cash-structured securities
- Purely stock options
- Derivatives
Types of Stocks
Cash-structured stocks are issued by companies and have a fixed price. Purely stock options are contracts that give the buyer the right to buy or sell an underlying asset at a predetermined price.
| Stock Type | Description |
|---|---|
| Cash-structured stocks | Issued by companies with a fixed price. |
| Purely stock options | Contracts that give the buyer the right to buy or sell an underlying asset at a predetermined price. |
| Derivatives | A financial instrument that is based on the price of an underlying asset (e.g., stocks, futures contracts). |