When a company grows large enough, it often holds a public offering, enabling the general public to own a piece of the company, cast their vote, and receive dividends. This is done as a means of generating revenue, and enabling early investors to liquidate some of their holdings. For example, when Facebook went public in 2012, its founder Mark Zuckerberg sold 30.3 million of his shares for $1.1 billion.
Stock prices are influenced by a company’s market cap, meaning that as the company grows in value, so does its stock price. There are many different factors that could influence stock price, including: Product launches, earnings reports (released quarterly), news events having to do with the company or one of its competitors - and many others.
On eToro, stocks are traded as CFDs, meaning the client doesn’t own the underlying assets, but rather, engages in a contract with eToro to settle the difference between the opening and closing price of a position. This enables faster processing of transactions, fractional ownership, placing “sell” (short) orders - and other benefits.
A popular trend in stock trading is thematic investment, which means investing in several stocks from the same category, such as tech. For example, if a trader believes in the tech industry as a whole, they would open positions for companies such as Google, Facebook and Apple.
Show More »Show Less
Trade stocks now
All trading involves risk. Only risk capital you're prepared to lose.