How Does The Stock Market Work? – Oliver Elfenbaum
Lesson summary:
The Dutch East India Company employed hundreds of ships in the 1600s to trade gold, porcelain, spices, and silks around the globe. To fund these expensive voyages, the company turned to private citizens and offered them a share of the ship’s profits in exchange for investing money to support the trip. This practice allowed the company to afford even grander voyages and unknowingly invented the world’s first stock market. Today, companies collect funds from willing investors to support all kinds of businesses. The modern stock market is significantly more complicated than its original incarnation, and companies and investors use the market to buy and sell stocks, which makes the investors partial owners in the business. The stock market is influenced by many factors such as market forces, leadership, bad publicity, and new laws and trade policies. This causes day-to-day noise in the market, which can make companies appear more or less successful. Therefore, most professionals promote reliable long-term investing.