In simple terms, stock is a share in the ownership of a company representing a claim on the company's assets and earnings. The more the stock you acquire, the greater your ownership stake in the company.

Stocks are mostly traded on exchanges in two basic ways: on the floor of the exchange or electronically. The trading floor of an exchange resembles a picture of apparent chaos, with traders yelling, waving, talking on the phone, and sending wild signals to each other. The exchange where trade is executed electronically involves a network of computers.

A stock market that helps the exchange of shares between buyers and sellers is of two types: primary and secondary. In the primary market, securities are created by means of an