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/biz/ - Business & Finance

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56121218 No.56121218 [Reply] [Original]

What does buying a stock actually do? How does that affect the company?

>> No.56121288

>>56121218
When you buy a stock, you are buying a microscopic portion of the company itself. The more shares people buy, the higher the perceived value of the company rises, which helps with shit like investments and other financial things on the company’s end, as it shows that people believe whatever its doing has some value. The more value the company gets, the higher the stock price goes, which increases the potential money you gain from what you purchased, and vice versa. Its a pretty simplistic way of putting it and leaves some other stuff out, but thats the general idea. On the flip side if you own a company and it goes public, then it technically isn’t actually “your” company anymore, as now you have shareholders and other such things you have to answer to, and can even be outed from if you fuck up too much and they get tired of your shit.