What is stock market and Types of Stocks to Invest ?

What is stock market?

Stock markets are venues where buyers and sellers meet to exchange equity shares of public corporations. Stock markets are vital components of a free-market economy because they enable democratized access to trading and exchange of capital for investors of all kinds.

Share market

Types of Stocks to Invest:-

Common stock

Preferred stock

Large-cap stocks

Mid-cap stocks

Small-cap stocks

Domestic stock

International stocks

Growth stocks

Value stocks

IPO stocks

Dividend stocks

Non-dividend stocks

Income stocks

Common stock and preferred stock

Most stock that people invest in is common stock. Common stock represents partial ownership in a company, with shareholders getting the right to receive a proportional share of the value of any remaining assets if the company gets dissolved. Common stock gives shareholders theoretically unlimited upside potential, but they also risk losing everything if the company fails without having any assets left over.

Large-cap, mid-cap, and small-cap stocks

Large-cap stocks are generally considered safer and more conservative as investments, while mid caps and small caps have greater capacity for future growth but are riskier.

stocks having market caps between $2 billion and $10 billion qualifying as mid-caps and stocks with market caps below $2 billion getting treated as small-cap stocks.

one often-used rule is that stocks with market capitalizations of $10 billion or more are treated as large-caps.

Domestic stocks and international stocks

important to understand that a stock's geographical category doesn't necessarily correspond to where the company gets its sales. Philip Morris International (NYSE:PM) is a great example, as its headquarters are in the U.S., but it sells its tobacco and other products exclusively outside the country.

Growth stocks and value stocks

Growth stocks tend to have higher risk levels, but the potential returns can be extremely attractive. Successful growth stocks have businesses that tap into strong and rising demand among customers, especially in connection with longer-term trends throughout society that support the use of their products and services.

Value stocks, on the other hand, are seen as being more conservative investments. They're often mature, well-known companies that have already grown into industry leaders and therefore don't have as much room left to expand further.

IPO stocks

IPO stocks are stocks of companies that have recently gone public through an initial public offering. IPOs often generate a lot of excitement among investors looking to get in on the ground floor of a promising business concept.

Dividend stocks and non-dividend stocks

Many stocks make dividend payments to their shareholders on a regular basis. Dividends provide valuable income for investors, and that makes dividend stocks highly sought after among certain investment circles. Technically, paying even $0.01 per share qualifies a company as a dividend stock.

Income stocks

Income stocks are another name for dividend stocks, as the income that most stocks pay out comes in the form of dividends. However, income stocks also refer to shares of companies that have more mature business models and have relatively fewer long-term opportunities for growth.

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