U.S. Stock Market
A stock market is defined as a public entity for the trading of company stock at an agreed price. When you buy stock, you become a shareholder, which means you now own a part of the company. If the company's profits rise, you will share in those increased profits. If the company's profits fall, so does the price of your stock. If you sold your stock on a day when the price of that stock falls below the price you paid for it, you would lose money. In the stock market, prices rise and fall every day. When you invest in the stock market, you are hoping that over the years, the stock will become much more valuable than the price you paid for it. The idea is to have your investment appreciate in value and increase your wealth. The stock market plays a very important role in the well-being of the economy and is one of the most vital sources for companies to raise money. History and experience has shown that the price of shares is an important part of economic growth. Rising share prices tend to be associated with increased business investment. They also affect the wealth of households and their consumption. Therefore, central banks tend to keep an eye on the control & behavior of the stock market and, in general, on the smooth operation of financial system functions. The stock market appears in the news every day. You hear about it any time it reaches a new high or a new low, & you also hear about it daily in statements like "The Sensex rose 3% today ..." Obviously, stocks & the stock market are important.
There are two leading stock markets in U.S., the New York Stock Exchange (NYSE) and the Nasdaq. The stocks I compared traded in the NYSE and the Nasdaq exchange are listed and summarized below.
Dollar General (DG, NYSE) 5-Day Closing Prices
Target (TGT, NYSE) 5-Day Closing Prices
References: Investopedia Staff. (2010). Foreign Exchange Rates Quotations . Retrieved April 4, 2011 from: http://mutualfunds.about.com/od/managingyourportfolio/a/International_Funds_and_a_Depreciating_Dollar.htm
Yahoo! Finance. (2011). Retrieved April 4, 2011 from http://finance.yahoo.com
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