Capitalize for Kids Student Challenge

Part 1: What is a Stock?

Capitalize for Kids Student Challenge

INVESTING 101

“Equities,” “stocks,” and “shares” are three words that often mean the same thing. When you invest in a company and purchase a stock, you are purchasing a small portion of the corporation. You hope that the company does well and that the stock price increases over time so you and the other shareholders can make money when you sell. If the business prospers, common shareholders may receive dividends, or make capital gains if their shares are sold at a profit. However, if the business fails, the stock price may decrease, meaning that you could lose part or all of your investment if you decide to sell.