Stock markets are platforms where shares of publicly listed companies are bought and sold. When a company wants to raise long‑term capital, it can issue shares to investors through an initial public offering (IPO); after listing, these shares trade on stock exchanges where prices fluctuate according to demand and supply. Investors buy shares hoping that the company will perform well, leading to higher share prices and possibly dividends, while sellers may exit to lock in profits, reduce risk or reallocate their portfolios.

The main participants in stock markets include individual investors, institutional investors like mutual funds and pension funds, brokers who execute trades, and regulators who ensure fair play and transparency. Market indices track the performance of a set of major stocks, providing a snapshot of overall market mood. Prices respond to many factors: earnings reports, economic data, policy changes, global developments and investor sentiment. While stock markets can create wealth over the long term, they also involve significant risk, especially in the short term. Sensible investing involves understanding one’s risk tolerance, diversifying across sectors and asset classes, avoiding rushed decisions based on rumours, and remembering that high returns usually come with higher risk.