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Investor's Perspective: What is a Stock and How Does It Work?

Note to investors... COVID-19: Pandemic crises have been occurring since the beginning of economic activity and always will be. Unfortunate events come & go and should NOT influence or deter your [long-term] investment strategy.

A stock is a share of ownership within a corporation.

A stock represents one of many outstanding shares of a corporation.

Companies issue shares of stocks as a means for raising capital for the business.

A stock is bought and sold on a stock exchange such as the New York stock exchange or the Nasdaq.

A stock gives the owner voting rights within a corporation.

Stocks are traded on broker-dealer platforms such as Charles Schwab, Fidelity, and Vanguard to name a few.

Stocks can be traded by the individual owner or by way of a professional investment manager.

Stocks (corporations) can be evaluated through publicly available financial information through the broker-dealer platforms.

The market value of a stock can be evaluated through the historically available charts through the broker-dealer platforms.

Stocks are better suited for the long-term oriented investor.

Stocks can be a gateway to building wealth when used strategically.

Stocks should not be evaluated based on the day-to-day fluctuations of the market price.

Stocks should be evaluated based on the performance of the underlying business and the projected future cash flows.

Stocks should be evaluated with the same level of care as if you were buying the entire business.

Owning stocks gives you a share of the company's profits over time.

Last but certainly not least, always consult with your trusted advisor before you proceed with any investment decisions.

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Disclaimer: Hudson Wealth Management, LLC (HWM) is a FINRA registered investment adviser firm. Investing in securities involves risks, and there is always the potential of losing money when you invest in securities. Before investing, consider your investment objectives and HWM's fee schedule. The information provided herein is for illustrative purposes only and does not constitute personalized investment advice, recommendations or solicitations to hold, buy or sell any investment or security of any kind. All images and return figures shown are for illustrative purposes only and are not actual customer or model returns. Past performance does not guarantee future results.

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