What a stock actually is

Ownership, not a bet slip

A stock is a share of ownership in a company. If a company has 100 shares and you hold 10, you own 10% of it. That ownership is a claim on whatever the business earns over time, not a promise that the price will go up tomorrow.

Companies sell shares to raise money they can use to hire, build, or pay down debt. In return, shareholders take on the risk that the business does poorly — and the chance that it does well.

Price is an agreement

The quoted price is simply the last price two people agreed on. It is not an official appraisal. If no one wants to sell at your bid, you do not own the shares yet — no matter what a chart says.

That last print moves in ticks: the smallest amount the price is allowed to change. For most U.S. stocks that increment is $0.01. If the last trade was $50.00, the next one can be $50.01 (an uptick) or $49.99 (a downtick) — not $50.003.

The ticker is the company's short name on the screen (AAPL). The tick is the move. Market value (often called market cap) is share price times the number of shares. A $50 stock with 2 million shares is a $100 million company. A $500 stock with 10,000 shares is a $5 million company. Price per share alone tells you almost nothing.

Why prices move

Prices move when buyers and sellers change their minds about the future of the business — earnings, competition, interest rates, or simply mood. Over long stretches, a stock tends to follow the company's results. Over short stretches, it can do almost anything.

This course treats trading as a skill of process: how orders work, how to size risk, how to read a quote. It is not a method for picking winners.