What Is A Stock Market?
Stock market is a market where stocks are bought and sold. When we want to buy eggs and milk we go to supermarket. Similarly we have stock market where people buy and sell stocks. Only difference is you have to use brokerage frim as a middle man that helps you buy and sell. USA has 2 stock markets New York Stock Exchange (NYSE) and NASDAQ. They are located at the Wall Street of New York City.
What Is A Stock Index?
You probably heard a lot from the news channels daily that the stock market is up today or down today. Even though stock market is a place to buy and sell stocks, in the financial world, people refer to the 3 main indexes as the stock market. They are S&P 500 (Tracks performance of the 500 largest companies), Dow Jones (Tracks performance of the 30 prominent companies) and NASDAQ (Tracks performance of the top 100 technology companies). These indexes track the stock performances of the included companies in real time. Among them, S&P 500 is widely considered as the Market.
Bull Market Vs Bear Market?
The terms Bull Market and Bear Market are fundamental concepts used to describe the trend and sentiment of the stock market. Bull Market is characterized by a sustained period of rising prices, while a Bear Market is defined by a prolonged period of falling prices. In financial world, if the stock market (S&P 500) goes down by 20 percent from all time high then we are in a Bear Market. On the other hand if the stock market (S&P 500) goes up 20% from the bottom of the bear market then we are in a new Bull Market. Last bear market occurrence was from Jan 2022 to October 2022. We are in a bull market ever since.
What Are The Trading Hours?
The stock market opens a 9:30 EST in the morning and closes at 4:00 EST in the afternoon, Monday to Friday excepts federal holidays. This 7 hours period are the actual market hours where majority of the trades happen. Apart from that there are Pre-hours and After hours trading with a lower volume of trades. As stock market becoming more accessible to public day by day, brokers like Robinhood and few others are supporting 24 hours trading during week days.
What Is An ETF?
An Exchange-Traded Fund (ETF) is a type of investment fund that is traded on stock exchanges, much like individual stocks. ETFs hold a diversified portfolio of assets such as stocks, bonds, commodities, or a combination of these.
When you buy a share of an ETF, you are buying a piece of this underlying portfolio. For example, SPY and VOO are ETFs that invested in the the S&P 500. So if you want to buy a small piece of the best 500 countries in USA then just buying the ETFs will do the job. ETFs have become very popular in modern day investing. There is a wide variety of ETFs available, designed to meet different investment objectives. Such as Index ETFs, Sector ETFs, Bond ETFs, Commodity ETFs, Actively Managed ETFs and Thematic ETFs.
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