What is a Stock?
💡 A stock is a tiny piece of ownership in a company. If you buy 1 share of Nike, you literally own a small piece of Nike.
Think of it like pizza 🍕
Imagine a company is a pizza cut into millions of slices. Each slice is a "share." When you buy a share, you own one of those slices. If the pizza (company) gets bigger and more valuable, your slice is worth more too.
Why do companies sell shares?
Companies need money to grow — to build new products, hire people, open stores. Instead of borrowing from a bank, they can sell small pieces of themselves (shares) to anyone who wants to buy.
What do YOU get as a shareholder?
- 1.Your share goes up in value — if the company does well, more people want to buy shares, pushing the price up. You can sell later for profit.
- 2.Dividends — some companies share their profits with shareholders. Like getting a small cash payment every few months.
- 3.Voting rights — as a part-owner, you sometimes get to vote on big company decisions (though with 1 share, your vote is tiny!).
Real example
Apple (AAPL) has about 15 billion shares. If you buy 1 share for ~$300, you own 0.0000000067%of Apple. Tiny — but you still get dividends ($0.96/year per share) and if Apple's stock goes from $300 to $350, your $300 became $350.
Key takeaway
Stocks = ownership. When you buy a stock, you become a part-owner of that company. The better the company does, the more your ownership is worth.