Stock Markets Basics
How equity markets connect companies with capital and investors with ownership
Your Progress
0 / 5 completedWhat Stock Markets Do
Stock markets are where ownership of companies gets bought and sold. They serve two critical functions: helping companies raise capital (primary market) and letting investors trade shares with each other (secondary market). Without stock markets, companies would struggle to grow and investors couldn't easily cash out.
Primary vs Secondary Markets
Company sells NEW shares to investors. Money goes to company to fund growth. One-time event when company "goes public."
Investors trade EXISTING shares with each other. Company gets no money. Continuous trading every business day.
Interactive: IPO to Public Trading
Company owned by founders and private investors. No public trading.
Major Stock Exchanges
Established 1792. Physical trading floor. $28T market cap. Blue-chip companies (Walmart, Coca-Cola, Disney). Slower, more traditional.
Established 1971. Fully electronic. $23T market cap. Tech-heavy (Apple, Microsoft, Tesla, Amazon). Faster trading, lower fees.
London Stock Exchange ($4T), Tokyo Stock Exchange ($6T), Shanghai Stock Exchange ($8T). Different rules, currencies, and time zones.
Most trading happens in the secondary market, but companies only raise money in the primary market (IPO). Secondary trading just transfers ownership—company doesn't see a penny.