What is the stock market?


Answer: In capitalist economies, business activities often happen through companies, which are entities that pool resources from investors to pursue a joint activity.  Individuals and entities that invest in a company receives stock in exchange for the investment.  The stock represents partial ownership in the company and makes them shareholders of the company.  

If other investors see value in the company, they can invest in the company by purchasing stock from shareholders.  The market which enables the exchange of shares of various companies constitues the stock market.