Stock Market Station: The Stock Market Explained for Kids

Stock Market Station is where Nova shows Wealthonauts how companies grow and how people own them. This planet gives the stock market explained for kids, from the meaning of a single share to the reasons prices change every day.

The stock market explained for kids

A company is a business that makes products or offers services. To raise money to grow, some companies sell small pieces of ownership called shares, or stock. People who buy shares are called shareholders. The stock market is the system of exchanges where shareholders buy and sell those shares with each other.

Public and private companies

A public company has shares that anyone can buy on a stock exchange, such as the New York Stock Exchange or Nasdaq. A private company is owned by a smaller group, such as its founders, and its shares are not traded on an exchange. Public companies must share regular reports with investors, which are overseen by the U.S. Securities and Exchange Commission.

Prices, dividends and supply and demand

A share price changes when buyers and sellers change their minds about what the company is worth. If more people want to buy than sell, the price usually rises. Some companies also pay shareholders a part of their profits, called a dividend. However, dividends are never guaranteed.

Investing, speculation and diversification

Investing usually means buying shares to own part of a business for a long time. Speculation means making short-term bets on price moves, which is riskier. Because any single company can have a bad year, investors often spread money across many companies and industries. That idea is called diversification.

Practice at Stock Market Station

Build a pretend portfolio in the Stock Market Simulator with fictional companies and virtual dollars. Then learn the basics in What Is a Share of Stock?.