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The stock market is a platform where companies raise capital by issuing shares to the public, and in return, investors receive a portion of the company's assets and profits. The stock market plays a crucial role in determining the value of companies and their products.
Historically, stocks have been known for their volatility, with prices fluctuating rapidly due to various factors such as economic trends, industry developments, and investor sentiment. However, over time, investors have learned to diversify their portfolios by investing in different asset classes, sectors, and geographic regions.
The most widely used stock market index is the S&P 500, which tracks the performance of 500 large-cap stocks in the US. Other popular indices include the Dow Jones Industrial Average (DJIA), the Nasdaq Composite Index, and the Russell 2000 Index.