What is the stock market and what is the point of it?

Answer 1

It is a place to purchase shares in companies, with a view to making a profit. Past performance over the medium to long term have shown a better return than leaving your money in the bank or building society. There is no guarantee this will happen, so therefore it is a risky investment. The risk depends on the type of shares you purchase. An example of risk is buying shares in a " blue chip " company ( meaning established and well known, like tesco or a bank ) An example of a greater risk is buying shares in a new company, that have no track record. This latter investment could be more speculative and could offer a better return than the Blue chip company or could lose you a lot of money. seek advice from an independent financial adviser or contact a stock broker.