What is a Stock?

Think of buying a stock as buying a tiny slice of a company’s pie. If the company grows and makes more money, your slice becomes more valuable. If the company hits a rough patch, your slice might shrink.
​Here is the breakdown of what stocks are and the roadmap to getting your first "slice."

​1. What is a Stock?

​When a company wants to grow, it can sell pieces of itself to the public to raise money. These pieces are called shares or stocks.

• ​Ownership: As a shareholder, you own a percentage of the company’s assets and earnings.
• ​The Goal: You generally want to buy low and sell high.
• ​Dividends: Some companies also pay out a portion of their profits to shareholders regularly, which is like getting a "thank you" check for owning the stock.

​2. How to Start Investing

​You don’t need to be a Wall Street tycoon to start. Here is the step-by-step process:

​Choose a Brokerage

​You can’t just call up Apple or Google and buy a share directly; you need a middleman called a broker.

• ​User-Friendly Apps: Robinhood, Wealthfront, or Acorns (great for beginners).
• ​Full-Service Firms: Fidelity, Charles Schwab, or Vanguard (great for long-term planning).

​Decide on Your Strategy

​Don't feel pressured to pick "the next big thing." Most investors use one of two paths:

1. ​Individual Stocks: Buying shares of specific companies (e.g., Tesla, Disney). High risk, high potential reward.
2. ​ETFs & Index Funds: These are "bundles" of hundreds of stocks. Instead of betting on one horse, you’re betting on the whole race. It’s generally much safer for beginners.

​Set a Budget

​Only invest what you can afford to leave untouched for at least 3–5 years. The market goes up and down daily; you don't want to be forced to sell during a "down" period because you need rent money.

​3. The Golden Rules

• ​Diversify: Don't put all your eggs in one basket. If you only own tech stocks and the tech industry crashes, your whole portfolio suffers.
• ​Think Long-Term: The stock market is a marathon, not a sprint. Historically, the market grows over decades despite short-term crashes.
• ​Watch the Fees: Even a 1% fee can eat a massive chunk of your gains over 20 years. Look for "no-commission" trading.
• 
  

​A Quick Reality Check: Investing involves risk. There is no guarantee you'll make money, and you can lose your initial investment. Always do your homework!