How The Stock Exchange Works (For Dummies)

Why are there stocks at all?

Everyday in the news we hear about the stock exchange, stocks and money moving around the globe. Still, a lot of people don’t have an idea why we have stock markets at all, because the topic is usually very dry. We made a short video about the basics of the stock exchanges. With robots. Robots are kewl!

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How the Stock Exchange works

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25 thoughts on “How The Stock Exchange Works (For Dummies)

  1. So our entire economy is pretty much controller by a hypothetical idea that
    can be sold? That sounds terrible…

  2. *People in the comments*:

    This video does not detail all there is to know about finance and stock
    exchanges. In fact, this video is somewhat misleading, especially in the
    sense that a company’s value is determined mostly/only by purchasing of its
    shares, aswell as the stated ‘idea’ that stock markets are a game of
    chance. IT’S NOT.

  3. How about about doing one about money and the banking system and quantative
    easing etc, the more people know that 97% of all money doesn’t actually
    exist in physical form the better.

  4. The loop hole in this system is huge, anybody can scare investors away from
    a product, or service with a little bit of facts and misconstrue these
    facts and turn them into the complete wrong direction, even though they
    think its a game of chance, its not, only to the ignorant its chance.
    People can take advantage of this system and make alot of money out of
    scare tactics. Sounds like fun!

  5. Me: I should post a silly comment!
    *reads intense convos in the comments*
    *whimpers and goes to the corner*

  6. This really is not a very informative video if you want to learn about
    stocks, since it paints the stock market as a place you go to for gambling
    your money on the short term and does not mention important things such as
    stock dividends which are the whole point of owning stock.

    Stocks are by far the best long term investment you can make, as long as
    you see stocks as a paper that gives you dividends from a company, and the
    market only as a place to buy or sell them and nothing more. If you feel
    that you have to react to events quickly or even bother about the short
    term value of your stock, you are using stocks the wrong way. You should
    judge the price of a stock by the dividends and capital that it’s company
    holds, not by how the market price has been trending recently.

    Warren Buffett explains it better than I do:
    http://fortune.com/2012/02/09/warren-buffett-why-stocks-beat-gold-and-bonds/
    

  7. Hello I have a question about how stock prices (shares) increase and or
    decrease. Let’s say I plan to start a company yet have no money so I sell
    10 shares for $10 each. Assuming all are sold I have $100, which I use to
    create my company. (So the company is worth $100?) Then let’s say my
    company is successful and I make $200. (Now the company is worth $200?)
    Here’s where I get confused. From my understanding their are 2 outcomes.
    1. The share prices double from $10 a share to $20 a share. Thus anyone who
    sells the stock makes a profit. But if all of my shareholders sell there
    stock, and I lose my $200, thus no profit and I’m broke???

    2. The share prices stay at $10 and I make a profit and possibly the
    shareholders if I add a dividend (which can’t be anything too substantial).
    My profit is $100 yet the shareholders is close to none so the share prices
    don’t increase???

    Please correct my example as needed and tell me what I’m misunderstanding.
    Thanks for your time guys!!
    

  8. Couldn’t a company buy it’s own shares when it’s price is down and then
    work harder and re sell them?

  9. I found out some more information on this topic and it seems the big
    problem is crony capitalism and a system that is rigged in favor of the
    rich and powerful. There is nothing wrong with capitalism or the stock
    market, but there is a problem with the way it is being carried out here in
    the US and many other countries as well. It’s complicated and I don’t
    understand everything about the economy, but it is very clear we don’t have
    a level playing field and it seems to be getting worse every decade. 

  10. So how do you justify how much shares a business has? do companies that are
    worth more have more shares for people to buy? 

  11. First it was teeth, then it was rocks, then it was gold, then it was paper,
    now it is random imaginity numbers. Wonder what the next form of currency
    will be? I’m beating on blood, because when the day comes when all of the
    governments say they are broke because they over spent their invisible make
    believe money there will be roiting and blood shead. Thats why im saving up
    all my blood instead of giving it to the red cross its going to be the only
    thing of worth soon, that and twinkies, I love twinkies.

  12. My father invested 10k into apple back in 1995.God, it might have been the
    best decission he ever made!

  13. Please do make a video about how change in economy in one country effects
    the other and other such international economic “relations” ……..
    It will help us understand this much better….
    Thank you for the video!!

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