202503211631 - Stock

Short Selling Long Stock Options

What is Public Stock?

Public stock represents ownership in a publicly traded company, where shares are made available for purchase by the general public through stock exchanges or over-the-counter (OTC) markets. When individuals buy stock, they acquire partial ownership in the company, often with rights to vote on corporate matters and receive dividends. Public companies, such as 202207152017 - Apple Inc. or McDonald's, are required to disclose financial information regularly to ensure transparency and accountability1 2.

How Public Stock is Traded: Historically and Today

Historically:

The concept of stock trading began in the early 1600s with the establishment of the Amsterdam Stock Exchange, where shares of the Dutch East India Company were traded—the first publicly traded company3.
In the U.S., stock trading gained prominence with the creation of the New York Stock Exchange (NYSE) in 1792, following the Buttonwood Agreement. Early trading was conducted manually through open outcry systems on exchange floors3 4.

Today:

Modern stock markets operate electronically, with sophisticated systems matching buy and sell orders almost instantaneously. Major exchanges like the NYSE and NASDAQ facilitate global trading.
Stocks are traded in two primary markets:
- Primary Market: Companies issue new shares through Initial Public Offerings (IPOs) to raise capital4.
- Secondary Market: Investors trade existing shares among themselves, with prices determined by supply and demand4.

Ways to Purchase Stock

Direct Stock Plans (DSPs):
- Some companies allow investors to buy shares directly from them without a broker. This often requires meeting certain conditions, such as being an employee or existing shareholder5 6.
Dividend Reinvestment Plans (DRIPs):
- Investors can reinvest dividends from stocks they already own to purchase additional shares automatically5 6.
Brokerage Accounts:
- Most stocks are purchased through online or full-service brokers. Online brokers like Charles Schwab or Robinhood offer low-cost platforms for buying and selling stocks8 9.
Stock Funds:
- Investors can buy mutual funds or exchange-traded funds (ETFs) that hold a diversified portfolio of stocks, offering a less hands-on approach5 6.
Fractional Shares:
- Many brokers now allow investors to purchase fractional shares, enabling them to invest in expensive stocks like 20220708 - Google with smaller amounts of money8 9.
Robo-Advisors:
- Automated platforms invest on behalf of users based on their risk tolerance and financial goals, making it easy for beginners to enter the market9.

By leveraging these methods, individuals can participate in stock ownership and potentially benefit from capital appreciation and dividends while contributing to the growth of publicly traded companies.

Citations:
[1] https://www.investopedia.com/terms/p/publiccompany.asp
[2] https://www.investopedia.com/ask/answers/difference-between-publicly-and-privately-held-companies/
[3] https://www.sofi.com/learn/content/history-of-the-stock-market/
[4] https://www.investopedia.com/articles/investing/082614/how-stock-market-works.asp
[5] https://dfi.wa.gov/financial-education/information/basics-investing-stocks
[6] https://www.investor.gov/introduction-investing/investing-basics/investment-products/stocks
[7] https://www.investopedia.com/terms/p/public.asp
[8] https://www.nerdwallet.com/article/investing/how-to-buy-stocks
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[14] https://en.wikipedia.org/wiki/Initial_public_offering
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[17] https://www.thestreet.com/dictionary/public-company-publicly-traded
[18] https://www.nasdaq.com
[19] https://www.nyse.com/index
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[21] https://www.wsj.com/market-data/stocks
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[25] https://www.nasdaq.com/market-activity/stocks
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[27] https://finance.yahoo.com/markets/stocks/most-active/
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[34] https://www.schwab.com/learn/story/how-to-buy-stocks-4-steps-beginners
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[38] https://eqvista.com/business-structure/public-companies/
[39] https://en.wikipedia.org/wiki/Public_company
[40] https://www.vemil.hr/en/characteristics-of-public-company/
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[43] https://www.strike.money/stock-market/history
[44] https://www.tradingview.com/markets/stocks-usa/market-movers-active/
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[46] https://tradingeconomics.com/united-states/stock-market
[47] https://guides.loc.gov/wall-street-history/exchanges
[48] https://www.reddit.com/r/personalfinance/comments/8hnkfs/i_need_a_basic_tutorial_for_how_to_buy_stocks/
[49] https://www.investor.gov/introduction-investing/investing-basics/how-stock-markets-work/types-orders