Julie Gerend, finance professor at the University of St. Thomas Opus College of Business, was recently featured on the KARE 11 “Your Money” show to provide insight into how the stock market works.
Host: So, at the beginning of the stock market, what exactly is the stock market? What are some of the basics of what’s involved there?
Gerend: Well, the stock market in basic terms, is an ability to invest in stocks and ask yourself, do I want to own this company? When you go to the bank and put money in the bank and perhaps, maybe allow the bank to do a CD, you’re giving them your money and it may earn an interest rate. In the case of the stock market, it’s active investing in companies and you become an owner of the company.
Host: You’re buying a piece of a company and if the company gets bigger, your piece gets bigger.
Gerend: Yes. Well, and particularly if it goes up, right? You want the concept of buy stocks low and sell them high so that if they appreciate, if they go up in value, you get to participate in that.
