Stocks: Owning a Piece of a Company

Have you ever wanted to own part of your favorite company? Like Disney, Nike, or Roblox? Believe it or not, that’s actually possible. You don’t have to always have the next big idea, or open a store, or even have a business owner. Instead, you can buy stocks of that specific company. Stocks are a small piece of the company that generate money from it. Let’s break it down so that you can effectively understand what stocks are, why people buy them, and how they can help you grow money to prepare for your future.

What are Stocks?

Imagine if your favorite company was a giant pizza. When you buy a piece of that stock, or in this case, it’s a pizza slice. You get something from that pizza slice. Each slice represents a share of the company, if a company has 1,000 shares and you own 1 of them, you own one-thousandth of that company. That may sound small but if the company is successful, even a small piece can be valuables

Why Do Companies Sell Stocks

You might sometimes wonder, “Why would a company give away pieces of itself?”. The answer is simple: money to grow. Companies sell stocks to raise money so they can create new products, open more stores, or even upgrade their products. Then, people like you (investors) get to own a part of the company.

How Do You Make Money From Stocks?

You can make money from the stock prices going up, if you buy a stock for $10, later it’s worth $20. You just doubled your money. That’s called a capital gain. Or when some companies share their profit with stockholders. Imagine if every time your favorite ice cream shop made money, they gave you a little bit for owning some of it. That’s what we call dividends.

Why Do Stock Prices Change?

Stock prices change every single day, like a roller coaster. Why? People are always guessing how well a company will do in the future, if lots of people believe a company is going to make more money, they hurry to buy shares. When this happens the price goes up. If people are afraid the company won’t do well, they sell their shares, and the price goes down.

Is It Risky?

Yes, stocks can be a bit risky. Just like if in Minecraft, you fight the ender dragon, you could lose your lives and inventory. Similarly, your stock’s value can go down, but overtime, many companies grow, and patient investors often see their money grow too. That’s why investing stocks is most effective when you’re in it for the long-term run.

Roblox Stocks

Let’s be honest, we all love Roblox. If you buy a stock of Roblox, you become partial owner of Roblox. If Roblox releases a cool new update and more people play the game, the company could make more money, and the stock price might go up. But if Roblox loses players or has Roblox, you’ll lose money.

Why You Should Learn About Stocks

Investing young is likely one of the best choices you can make, you’ll have years for your stock to grow, learning about it now gives you an even bigger edge. Understanding how these businesses work and how investors make decisions will help you later. Whether you start your own company or invest in one. Stocks teach you patience, so grab a parent or guardian, make sure supervised, and start investing. Even a little goes a long way!