Stock Market
When most people think of investing and finance, they think of the stock market. We think of rolling stock tickers, opening bells, and a controlled pandemonium that we see on TV and the news of how these markets operate. While this is still true of some markets, like the New York Stock Exchange (NYSE), more and more stocks are traded by computer.
With more people buying mutual funds, and having 401(k)s, the stock market has started to play a significant role in many peoples lives. Many peoples livelihoods and/or retirement may rely on these markets. Stock markets provide the location and/or means for individuals and companies to trade or exchange stocks. Most markets are based on an auction model where buyers bid for stocks at a specific price, and sellers ask for a specific price for the stock. When those prices overlap, a sale occurs.
Most day-to-day financial news and reporting revolves around overall stock market performance, performance of indexes, and activity on individuals stocks. There are many factors that can affect the price of a stock, including performance of the underlying company such as profits or dividends, investor confidence or mood, overall financial performance, international news, and many others.