“Today, we’ll examine a new kind of financial intermediary: stock markets. As an individual, you participate in the stock market when you buy a company’s shares. This turns you into a part-owner, entitled to some of the company’s profits. Sometimes, profits are paid out directly via dividends. Other times, profits are reinvested for company growth. In this case, you benefit by seeing the value of your shares rise in tandem with this growth.”
For more investment trends, visit the Portfolio Construction Channel.