Stock market definition

What is the stock market?

The stock market is a network of investors that interact with each other to buy and sell shares in publicly traded companies. The stock market isn’t a physical place, but there are physical venues where companies list their shares for investors to buy or sell – known as ‘stock exchanges’.

Examples of stock exchanges

Here are some examples of stock exchanges from around the world:

• London Stock Exchange – the largest exchange in the UK. Many companies that are included in the FTSE 100 index are listed on the LSE.
• New York Stock Exchange – the largest stock exchange in North America and the world in terms of the market capitalisation of its listed companies.
• B3  – the largest stock exchange in South America, located in Sao Paulo, Brazil.
• Shanghai Stock Exchange – the largest stock exchange in Asia.
• ASX – short for Australian Securities Exchange, this is the largest stock exchange in Oceania.

How to invest in the stock market

There are several ways that you can invest in the stock market. The main thing you need to do is invest in assets that give you exposure to company share prices. So, you could either buy stocks outright, or you could invest in assets like tracker funds or exchange traded funds (ETFs) – which group together a range of different companies into a single investment fund.