How does stocks work - Investopedia explains the benefits:because many dividend-paying stocks are lower risk, the stocks are an appealing investment for both younger people looking for a way to generate income over the long haul, and for people approaching retirement - or who are in retirement - who desire a source of retirement income. Chances are these are the types of stocks you've heard people discuss when talking about buying or selling a stock because they're the most interesting and see the most change on a daily, quarterly, or yearly basis. You can buy shares of mutual funds or etfs which are essentially managed pools of money wherein another company invests in a wide variety of stocks and you get a portion of the returns. As we mentioned earlier, etfs and mutual funds are a good way to get started because they both involve investing in an already diversified portfolio that other people do the tedious research on.
Why are there stocks at all? Everyday in the news we hear about the stock exchange, stocks and money moving around the globe.