The stock market can feel mysterious, but the core idea is simple: it's a marketplace where people buy and sell tiny ownership slices of companies, and prices move with supply and demand.
See it in action: Watch supply and demand move prices live in the simulator.
A stock (or share) is a fractional piece of ownership in a company. Own one share of a company with a million shares and you own one-millionth of it — including a claim on its future profits. Companies sell shares to raise money; investors buy them hoping the company grows.
A stock exchange — like the NYSE or Nasdaq — is the organized marketplace where shares change hands. It matches buyers with sellers and publishes the price of every trade. Per the U.S. Securities and Exchange Commission, exchanges exist to make trading fair, orderly and transparent.
Price is simply where buyers and sellers agree. If more people want to buy a stock than sell it, the price rises; if sellers dominate, it falls. News, earnings, interest rates and plain emotion all shift that balance second by second — which is why our games model price as a random walk with drift.
At any moment a stock has a bid (the highest price a buyer will pay) and an ask (the lowest a seller will accept). The gap between them is the spread. Try quoting both sides yourself in the market-making drill.
You don't need real money to learn. A stock market simulator lets you buy, sell and feel real price swings risk-free.
There are two stages to a stock’s life. In the primary market, a company sells brand-new shares to raise money — most famously through an initial public offering (IPO). After that, those shares trade among investors in the secondary market; the company itself isn’t involved and gets no new cash when you buy from another investor. The vast majority of daily trading you hear about is secondary-market activity.
The main U.S. exchanges, the NYSE and Nasdaq, run a regular session from 9:30 a.m. to 4:00 p.m. Eastern Time, Monday to Friday, excluding holidays. There is also pre-market and after-hours trading, but volume is thinner and spreads are wider then — see after-hours trading.
A market order buys or sells immediately at the best available price — fast, but the exact price isn’t guaranteed. A limit order trades only at your specified price or better — price-certain, but it may never fill. Learning when to use each is the first real skill; practise reading the numbers in how to read a stock quote. It's the same reason pilots train in simulators before flying.
It's a marketplace where people trade small ownership stakes (shares) in companies. Prices rise when buyers outnumber sellers and fall when sellers dominate.
Because price reflects the constant tug-of-war between buyers and sellers, driven by news, earnings, expectations and emotion.
Practice with a free simulator or paper trading before risking real money.