Stocks and bonds are bought and sold on the stock market through the use of a brokerage firm. A brokerage firm is a financial institution that provides a platform for investors to buy and sell securities and charge a fee for their services.
When an individual wants to buy a stock, they will typically open an account with a brokerage firm and deposit money into that account. Once the account is funded, the individual can then place an order to buy a specific stock at a specified price. The brokerage firm will then execute the trade on the stock market.
The process for buying bonds is similar, but instead of placing an order to buy a specific stock, the individual will place an order to buy a specific bond. The price of a bond is determined by factors such as the creditworthiness of the issuer and the coupon rate, which is the interest rate paid on the bond.
When an individual wants to sell a stock or a bond, the process is similar. They will place an order to sell a specific stock or bond at a specified price, and the brokerage firm will execute the trade on the stock market.
It’s worth noting that there are different types of brokerage firms, such as discount brokers and full-service brokers, each with their own pros and cons. Discount brokers typically charge lower fees but offer fewer services, while full-service brokers charge higher fees but offer more comprehensive services such as research and investment advice.
Stocks and bonds are bought and sold on the stock market through the use of a brokerage firm. An individual will open an account with a brokerage firm, deposit money into that account, place an order to buy or sell a specific stock or bond at a specified price and the brokerage firm will execute the trade on the stock market.
If you are interested in the full article, it can be found here: Investing-101-a-beginners-guide-to-the-stock-market
