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Lesson 1.1 · 1 of 5 · First steps
What is a stock? A five-minute beginner lesson with exercises
A stock, or share, is a small piece of a company. Buy one and you become a part-owner: you gain when the company grows or pays dividends. You buy it through a broker, starting with small amounts.
Terms in this lesson
- Stock
- A small piece of a company that you can buy on the stock exchange.
- Dividend
- The part of its profit a company pays to shareholders, in cash.
- Broker
- The firm through which you buy and sell stocks, ETFs and other investments.
- Stock exchange
- The market where stocks, bonds and ETFs are bought and sold, under strict rules.
Opening question
You buy one Coca-Cola share. What have you actually bought?
You have bought part of the company. A fixed-interest loan to a company is a bond, not a share.
It does not matter if you get it wrong: trying first helps you remember.
What a stock is
Definition
What is a stock?
A small piece of a company. Whoever holds it is a part-owner.
A large company is split into millions or billions of equal pieces. Each piece is a share. When you buy one, you become a shareholder: one of the company’s owners.
Apple: 14.6 billion sharesYou own 1
Example
What does that mean in money?
One Apple share is one piece out of 14.6 billion.
It sounds tiny, but it is real ownership. On 15 July 2026 one Apple share cost $327.22 and the whole company was worth about $4,780 billion on the stock market. That figure is its market capitalisation, and it changes every second the market is open.
1your share
of14.6 bnApple shares
Data as of 15 July 2026.
Work it out
A company has 2 million shares and one share costs $50. What is the whole company worth on the stock market, in millions of dollars?
$ million
A hint
Multiply the number of shares by the price of one share.
2,000,000 × $50 = $100,000,000, or $100 million. That is the market capitalisation: the number of shares multiplied by the share price.
What you get when you own a stock
GrowthYou gain if the company grows
If the company becomes worth more, your share is worth more too. You lock in the gain when you sell.
DividendYou get a share of the profit
Many companies pay a dividend once or several times a year. Apple paid $1.05 per share in the 12 months to 15 July 2026.
VoteYou get a vote
You can vote at the shareholders’ meeting, even with a single share.
Myth or fact?
“If a company I own shares in goes bust, I have to pay its debts.”
Myth. As a shareholder, the most you can lose is what you paid for your shares. The company’s debts stay with the company.
Check yourself
You own 10 shares and the company pays a dividend of $2 per share. What do you receive?
This exercise is in the free account, where we also save your progress.
Create a free accountWatch out
What you do not get
Any guarantee.
The price can fall, and the company can cut its dividend. If the company collapses, its shares can end up close to zero, as Wirecard’s did in 2020. That is why you do not put everything into one company.
Where and how to buy a stock
Definition
What is a broker?
The firm you use to buy and sell shares.
You open an account with a broker, add money and place a buy order. The broker buys the share for you on the stock exchange and holds it in your account. Sometimes you pay a trading commission for this.
- Open an account with a broker10 to 15 minutes, with your ID
- Add money to the accountby bank transfer or card
- Find the stock and tap “Buy”Apple, for example, or a company from your own country
- The share appears in your accountyou can sell it whenever the market is open
Put in order
Put the steps in order, from first to last.
This exercise is in the free account, where we also save your progress.
Create a free accountMyth or fact?
“You need at least $10,000 to start investing.”
This exercise is in the free account, where we also save your progress.
Create a free accountReady to start?
Where you can open an account
Regulated brokers available where you live.
You do not need to buy anything today. Opening an account is free, and the lessons carry on without one.
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What would you do?
You invested $500. Three weeks later your account shows $410. What do you do?
This exercise is in the free account, where we also save your progress.
Create a free accountWhat you learned
- A share is a piece of a company, and whoever holds it is a part-owner.
- You make money from shares through price growth and dividends, with no guarantee.
- You buy shares through a regulated broker, starting with small amounts.
You reached the end
Keep what you learned
With a free account we remember your lessons, bring back the questions you got wrong exactly when you need them and keep your streak.
Save your progress with a free accountNext lesson · 6 minCompound interest
Lessons are educational. They are not a recommendation to buy or sell. Investing involves risk and you can lose money. Sources: Apple’s share price, share count and dividend from einvestitii.ro market data (updated regularly); Wirecard’s insolvency filing of 25 June 2020.