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  1. How stock market works

  2. If you start investing in the stock market you probably wonderedhow stock market works

  3. The stock market is the area to make money but only when you have full knowledge about the stock market.

  4. If you are planning to invest in the stock market you should be aware of the facts and details about the stock market.

  5. This is the basic question of every stock market beginners that how stock market works. The answer is very simple.

  6. Companies go public to offer their shares or stocks and public buy shares and this whole process is known as stock exchange.

  7. People who are interested in the stock market can use stock exchange for buying and selling shares of the company.

  8. There are many factors involved in the stock market that helps you to know how stock market works.

  9. Stock prices and market capitalization are the two factors that help to increase your knowledge about stock market.

  10. *Stock prices*Stock prices means the price of a specific share sells for.

  11. Many market factors helps to set these prices like health of economy, trends of trading, technical and financial status of the company.

  12. *Market capitalization*Market capitalization is the actual value the company or stock that is up for sale.

  13. To calculate market capitalization of the stock we can use following formula:-

  14. Number of Outstanding Shares * Price of Stock = Market Capitalization of the Company.

  15. Once you have learnt the basic formula then you have to need to know about how to buy and sell shares.

  16. You need to create investment account to purchase stock and you can open it with a local stock broker. It is very simple to set up and fund it.

  17. After read this article now you have the answer of your question, how stock market works and how to invest in the stock market?

  18. Hopefully there will be no doubt in your mind about stock market and stock market investing.

  19. If you want to invest in the stock market then above things should keep in your mind because these are basics of the stock market. http://www.howstockmarketworks.com.au