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Buying and Selling Stocks and Securities in the Market

Stocks, commodities, foreign currencies and any other kinds of assets can be bought and sold on a daily basis with relative ease. While it might not be something many people do, enough people are constantly at work trying to make their fortunes in the various markets to create a robust trading environment. Buying and selling activities are not unlike those at any marketplace or pawn shop. The difference is, these are not necessarily mere goods, but are in many cases far more valuable ownership stakes.

Trading Ownership

Ownership is what assets are all about. When you buy an asset, you have some measure of control over it. You can reap the dividend yields or vote on what the stock's underlying company should do. You can choose to have the commodities you bought be delivered to your doorstep. You can hold foreign currencies for as long as you like, letting them appreciate or depreciate as the market deems.

Buying and Selling, Low or High

For every buyer, there is a seller and vice versa. Buying and selling happens on almost every day of the week, with the Forex market running every day except most of Sunday. To buy or open a position, all you have to do is adequately fund an account, decide how much of something you want to buy and then make the transaction. Often the entire process takes only a few seconds. When you sell or close out a position, all you have to do is go online or contact your broker and issue the order to sell. From there, an appropriate amount of money -- typically the sale price minus any commissions, spreads or fees -- will be returned to you.

Short Selling

Usually, buying means taking up immediate ownership of an asset. However, when you sell an asset short you do something slightly different. You sell the asset in question, then buy it later on to cover yourself. This is a riskier maneuver than simply buying and selling, and it should only be attempted by those with deep enough pockets to sustain the inevitable losses and with the experience to know what they are getting into. The process of short selling is useful if you believe that the price of a particular asset is going to go down in the near future, whereas traditional buying works on the principle that you may be able to sell at a profit later. You ultimately make your profit off of a short sale by later buying what you sold for less than you sold it for, claiming the spread or difference as your bounty.



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