How does a stock market work?
Money's Buzzing Garden
How does a stock market work?
Imagine you and your friends start a lemonade stand. You need money for lemons, sugar, and a pitcher, so you ask your neighbor for help. "I'll give you $20," she says, "but I want to own a piece of your stand — and if you make money, I get a piece of that too." Congratulations: you just sold your first share of stock.
A share is a tiny slice of ownership in a company. If your lemonade stand is worth $100 and your neighbor owns one share out of five total shares, she owns one-fifth of the business. If the stand does well and becomes worth $200, her share is now worth more too. If it flops, her share loses value. She's betting on you.
