Trading Stocks
Access insights and education for more informed stock trading and investing decisions.
Whether you're new to stock trading or have years of experience, Growth Cap offers the education, tools, and insights to support you at every stage.
What are stocks and how do they work?
Owning and trading shares of a company
A stock represents partial ownership in a company, offering a claim on its earnings and assets. As the company's value rises or falls, so does the value of its stock.
Stocks are generally bought and sold electronically through stock exchanges, the two primary ones in the United States being the New York Stock Exchange (NYSE) and the National Association of Securities Dealers Automated Quotations (NASDAQ). While some companies sell stock directly to investors, most only sell stock through a brokerage such as Growth Cap.
Stocks use cases
Investors buy and sell stocks for a number of reasons, including the potential to grow the value of their investment over time, to potentially profit from shorter-term stock price moves, or even to earn an income by investing in dividend-paying stocks. Stocks often play a role in a comprehensive financial plan that reflects your investment horizon and the level of risk you're willing to accept in exchange for the potential upside stocks can offe
A historical performance example of stocks in a portfolio
Investing in stocks, particularly large-cap equity U.S. stocks, has historically provided higher returns over time in comparison to asset classes in the chart, though with increased volatility. This potential for growth is why many investors choose to include stocks as part of a long-term strategy, while also managing risk through diversification.
This chart shows how a mix of asset classes arge-cap equity U.S. stocks, moderate allocation, fixed income, and cash equivalent have historically performed over a 20-year period. If you had invested $100,000 in large-cap U.S. stocks in 2004, for example, your investment could have grown to approximately $700,000 by 2024, despite market ups and downs.
A more diversified investment portfolio would likely have had a lower return, but reduced volatility.
