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adept-grumblefish28 t1_j27xu3m wrote

The stock exchange is a place where people buy and sell shares of companies. When you buy a share of a company, your kind of like a tiny owner of that company. You get to share in the profits that the company makes and you can sell your share to someone else if you want to. The stock exchange is kind of like a big, crazy auction. People always buying and selling shares, and the prices go up and down all the time depending on how much people want to buy or sell - supply and demand. If lots of people want to buy a share, the price goes up. If lots of people want to sell a share, the price goes down.

The prices can change loads in just a few minutes. Some people make a lot of money on the stock exchange, but other people lose money. It's a bit like gambling.

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mayners t1_j28754f wrote

I'd add to this that people don't always get a share of the profits, known as dividends, only certain companies pay out dividends.

And also the price is partly affected by things like the estimated value of a company both now and down the line in a few years. Things like good news of expansion or new products will help the price while bad news like recession or increased fuel prices will reduce the price.

For example during covid most companies went down in price because they weren't allowed to open, while PPE companies increased because of both being allowed to operate and increase in demand.

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