Stock market definition

The stock market is where shares of publicly listed companies are bought and sold. It’s not just one place – it’s made up of many exchanges around the world, like the London Stock Exchange (LSE), New York Stock Exchange (NYSE), and Nasdaq.

When you buy a share, you’re buying a small piece of a company. If the company does well, the share price might go up – and you could make a profit. If it pays dividends, you might get a regular payout too.

The term ‘stock market’ is used as a proxy for the collective performance of stocks in different areas of the world – but that’s usually in the context of different stock market indices. So when you hear things like ‘the stock market in the US is up this morning’ – it generally means that a stock market index in the US is increasing in value.

The stock market goes up and down daily based on things like company news, economic data, and investor mood. It can be unpredictable in the short term, but over the long term, it’s helped many people grow their money.

Capital at risk. All investing should be long term. The value of your investments can go up and down, and you may get back less than you invest.