What does it mean to invest in stock? What is Stock?

Well, let’s say you start up a company. You divide the company into 100, “shares” of stock. Each share gets 1 hundredth of your companies profit. Buying a share is risky. If you spend a lot of money on it, you could lose money if the company fails.

If you invested in stock at McDonalds, and they made 1,000,000,000, and if you paid $20,000 for your share, and you got 1 thousandth of the profit, you would make one million dollars.

You can only invest in stock if you have a public company. The different in a private and a public company, is that you can invest in stock in a public company, as on private companies you cannot.

Here is a picture of what stock can look like, constantly changing.



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