When a company completes its Initial Public Offering, or IPO, its shares go public and traders are able to buy and sell them in the stock market. This market is also known as a “secondary market” as the shares traded were previously exchanged in the primary market. When you invest in a company, you are therefore not buying the shares directly to it but rather from an existing shareholder.
ADVANTAGES OF STOCK TRADING?
Stock trading comes with several advantages, helping traders make the best out of their investments.
Use Many Trading Styles
In the stock market, you can either use scalping or day trading if you want to take advantage of small price movements. You can also use swing trading if you intend to follow the trend.
Get Dividend Payments
Shares allow the bearer to get dividend payments which can develop into a large ongoing revenue stream.
Apply Different Analyses
You can either use Technical Analysis that relies on the price action to predict direction, or Fundamental Analysis which tries to calculate the intrinsic value of a stock.