How to make money and profitable in the stock market

                                  How to Make Money  in the Stock Market

Hey i am a prince olick and thanks for joining my blog world  lesson and now in today's lesson what I'd like to do is just share with you what is a stock and how do you personally make money from it I've done this blog a few days  back it's a very simple and basic concept but if you're just getting started if you don't know what a stock is and you don't know how the stock market really works I just want to give you a quick little insight about the whole process behind a stock and the stock market and how it is that you personally as an investor can make money from it of course keep in mind that none of the trade examples here that we use are recommendations to buy or sell any stock or security it's strictly for educational purposes.

what a stock:

okay so the way that the market really works or the reason that these companies have stock is that they are looking to raise funding from investors and that's ultimately the whole point so for you if you're looking to start a business whatever that business is but you just don't have any money where do you get that money it's typically from other people and other investors so here's what I do if I'm looking to start a business okay I'm looking to start some kind of company it doesn't matter what the company is and here's the total value of my company so what typically happens is let's just say half of this is my company so okay so I'll say that the total value of this is let's just say $1,000 okay if you're looking to sell a larger company obviously this would be you know could be a million dollars could be a hundred thousand dollars so the value of it is irrelevant just use this as a guideline so here this share let's just say I plan to keep

fifty fifty one percent to be sure that I'm a controlling shareholder so this would be you okay you starting the company and this would be let's just say five hundred dollars worth of the company okay so if that's a thousand dollars you have half that's five hundred dollars worth of the company now in order to raise more money if you're looking to use that additional money for advertising for you know acquiring customer is for product development whatever it is which you might end up doing is selling parts of your company okay just giving them a piece of that company so here you have Joe who will get $200 worth of that company okay and then here you might get let's say sue that also gets $200 worth of the company and then over here you got Bobby and Bobby only gets $100 worth of the company and why does he only get $100 well you have 500 then here you have 200 200 and 100 so that together makes 500 and if you break this down on a share level or percentage basis this would be two shares this could be one share this is two shares and this would be five shares okay so overall you have five six seven eight nine ten shares total so the whole company has only ten shares total that it has within that thousand dollar value now the way that this really works is now is since the market is based on a last price sequence meaning as the price or value of those shares go up your value of that investment also goes up so here initially we put in 500 dollars they put in sue put in 200 Bobby put in 100 Joe put in 200 so overall these were our prices and per share on a shared basis you can see that per share it's

$100 okay just to make numbers simple you can see because two shares they had got $200 one share $100 two shares $200 this is our initial offer for our basic investors now as time moves forward and let's just say the value of this company started to rise and increase so instead of a thousand dollars let's just say the value of the total company now went up to two thousand dollars okay so basically doubled so what happens to this whole value of this company well your shares increased to one thousand dollars okay this increases to $400 okay so everybody basically gets an increase this goes to 200 and this goes to also 400 so for example if Bobby wanted to get out and he sold his shares at 200 that's the value of that company now okay if Bobby got out at let's say three times the value okay if he got out at three times the 100 because he said well I don't want to be an investor in this company anymore I want to get out and spend more time with my family so if he was able to sell his shares his one share for three times that initial value this would actually be $300 now so that means everybody's is now worth since we're on a last price base sequence is worth three times so this is actually worth $600 because right 200 times three is 600 this right here again the same thing this is worth now $600 and times three this is actually now $1,500 is your value and if you multiply this times three this is actually worth $3,000 okay so that's how it works on a last price sequence because in the stock market as you sell your shares the value of that stock price either goes up or down but basically the initial company they give out part of their company in order to raise money so that they can use it for advertising they can use it for marketing material they can build products 

 Profit in stock market:

whatever it is they're basically using that money to grow the company and that's ultimately how the baseline of it worked now if you look in the stock market of let's just say any company out there call it Disney Amazon Apple it doesn't matter you have a lot of shares out there so there are hundreds of millions of shares depending on the company and everybody has a piece of that company so there's a lot of people that have different pieces of that company it's not just you know five or six people that we just discussed or talked about there's a lot of people that have different fractions and different amounts of those shares and you personally what you're doing is you're just taking a small little sliver let's just say a tiny sliver probably even less than this amount and you're just taking a small little sliver so that way as the value of let's say Disney Apple Amazon goes up let's just say you had a hundred or two hundred shares whatever it is as that goes up then the value of each one of those shares goes up so if for example let's just say you had

one hundred shares of Disney and the current price of Disney shares is actually ninety seven ninety five okay so it's ninety seven dollars roughly and you had a hundred shares that means that you have to spend of nine thousand seven hundred and ninety-five dollars to acquire those hundred shares of Disney so this is what you basically pay or invest okay within Disney to get a hundred shares as that stock price goes up to let's just say one hundred dollars okay so if the the price goes up to a hundred dollars okay that price increase is two dollars and five cents so basically the value of the company went up two dollars and five cents from where you got in on it because everybody's getting in at different times that's the whole thing some people are getting in earlier because they have more money to invest earlier other people in are getting in later because now they have some money they have a job so everybody is getting in and out at different times so the point is is the company went up two dollars and five cents so you now with a hundred shares those hundred shares are worth more by two dollars and five cents so all you need to do is really multiply 100 by 205 and you basically May 205 dollars okay pretty simple math or the other approach that you could take is saying okay I have a hundred shares and then I take these hundred shares and I multiply it times a hundred dollar stock price okay so this is the stock price and now what's your total value your value is ten thousand dollars okay so that's your value now your shares so if you compare this to this number okay you'll see that the difference between these two is 205 so the math really is still the same whether you do it this way and calculate your value and take the difference or you just look at the difference here and see how much you make nevertheless that's how a company issues stock and that's how you personally make money from

investing in stocks so basically a company issue stock so that way they can raise more money to for a product enhancement for growing their customer base for advertising whatever it is for equipment they're raising money for this and you are giving them money in exchange for a piece or a little fraction of that company and as that value of that company grows so does the value of your piece of that company and later you can sell it when you want to and typically if you're trading a very public company it's very easy to get in and out of the company but otherwise that's really the base concept you're just getting a piece of that company whether you get 50 shares 10 shares a thousand shares 10,000 shares it's all depending on how much money you have depending on the value of the company of that stock price so that's what it comes down to and then eventually you're looking to sell it of course if the company value drops you're going to lose money and you do the calculation in reverse so I hope this little concept gives you some insight to the bigger picture of how the stock market works remember that it's based on that last price sequence and that's why stock prices constantly move up and down because as a new person buys or trades or sells his shares or their shares now that is the new price that's how it works okay so as it goes up twice or three times the value that's the new price so it's constantly moving and shifting around all the time in either case thanks for joining me.

 Finishing line:

I hope you enjoyed this this blog lesson and some insights about how the market works and about how the stock prices work and how you personally profit from them if you're interested to see some of my other blogs training lessons and get on the newsletter list click this link right here and when you get there enter your name and email address and you'll be put on the newsletter list so that way when I release new training material you'll get Oh defied but if you want to continue watching some of my other training lessons then email your and subscribe right here and you'll continue learning with me in the end remember do what you love contribute to others but most importantly live life abundantly I'll see you next time.