podcastsinenglish Level B.87 The bull and the bear
May 27, 2020
Richard breaks down the stock market for Jackie, explaining what the stock exchange is and how trading has evolved from chaotic scenes to streamlined electronic transactions. They delve into stock market indices like the FTSE and Dow, clarifying what they represent. The concepts of bull and bear markets are dissected, revealing how these terms relate to rising and falling markets. Richard emphasizes that online trading has democratized share ownership, while also advising on the importance of diversification to manage investment risks.
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Stock Exchange Defined
- The stock exchange is a market where large companies' shares are bought and sold.
- It provides a central place that reflects company ownership and value.
From Open Outcry To Electronic Trading
- Open outcry trading used to involve people physically shouting and exchanging paper.
- Richard says modern trading is mostly electronic, replacing that chaotic scene.
What Indexes Represent
- Market indices like the FTSE 100 and Dow Jones track top companies to indicate overall market performance.
- The FTSE100 lists the 100 biggest UK companies while the Dow Jones covers the top 30 in the US.