When a company decides to go "public", it sells shares of the company to people called "shareholders". People buy shares of stock or a share of the company in hopes of later selling it for a profit. The way to make a profit off of a share is to buy when it is low in price and sell when the price has increased to an amount above the original buying price. The share market can be a risky investment if you are not educated about the different shares and how they go up and down, but understanding the share market may be a difficult thing. However if one is aware about how the market works, no one can argue about the massive capital gain one can make by making the right decisions. In the recent years companies have plummeted whilst others have dramatically increased. For example supposing that you bought $10000 in shares with ABC Learning in 2001 when their shares were only $0.40 until now where 1 share sells for $8.46 that's twenty one times the price in 2001. That 10000 dollars would be $210000 now in 2006, If one made the right decision.
The price of shares constantly changes. There are many different factors that force the share prices to rise or fall such as economic trends, natural disasters, and the concept of supply versus demand. For example when hurricane Rita tore through the Gulf of Mexico, it destroyed a large amount of oil rigs, along with barrels of oil. This caused some what of an oil shortage resulting in increasing prices of oil and gas. Because of the rising price and demand of oil, many companies that dealt with oil and gas had significant increases in the price of their shares. This resulted in a profit for investors who owned the shares. Unfortunately, this natural disaster also brought great devastation to the country and its economy. Sometime t ...