Stocks

• Stock represents ownership of a company.
• You purchase stock in units called shares.
• By owning stock, you become a stockholder or shareholder, and you then own a piece of that company.
• You can earn money in two ways by owning stock.
• The company may pay back a portion of your loan in the form of a dividend.
• If a company you own performs well, or if market conditions or the economy is favorable, more people will want to own stock in that company, causing the value, or price, of the stock to rise. If this occurs, you would see the value of your investment increase.
• You also may lose money in a stock investment if you buy shares of a stock, the value of that stock drops and you then sell it at a lower value, or price.