Questrade - Empowering you to take control of your financial future. Join the journey!

---

What is Stock Trading?

---

Stock Trading is the buying and selling of shares of publicly traded companies on stock exchanges like the New York Stock Exchange (NYSE) or Nasdaq. When individuals or institutions buy stock, they purchase a small ownership stake in the company, which can fluctuate in value based on the company's performance, market conditions, and other economic factors.

There are two main types of Stock Trading:

1. Day Trading: Involves buying and selling stocks within a single trading day, with the goal of making short-term profits from price fluctuations. Day traders usually do not hold stocks overnight.
2. Long-term Trading (or Investing): Involves buying stocks with the intention of holding them for an extended period, potentially years, to benefit from the company’s growth and dividends.

Key Aspects of Stock Trading:

• Stock Prices: Determined by supply and demand. If more people want to buy a stock (demand), the price increases, and if more people want to sell it (supply), the price decreases.
• Stock Market Orders: Traders use different types of orders such as market orders (immediate execution) or limit orders (specific price targets).
• Risks: Stock trading can be risky. Prices can be volatile, and there is always a chance of losing money, especially in the short term.
• Brokerage Accounts: Investors typically need an account with a brokerage firm to participate in stock trading.

​
The goal of stock trading is to make a profit by buying shares at a lower price and selling them at a higher price, though not every trade results in profit.

---