When you buy a stock, you are buying a tiny slice of a real business, not a lottery ticket. Understanding how that business is traded on an exchange, how its price moves, and how you earn returns (dividends and capital gains) is the foundation of everything else you will do as an investor.

2.1 What a Stock Really Is

A stock (or share) represents ownership in a company. If you own one share of a business, you own a small fraction of its assets, profits, and future potential.

You can make money from a stock in two main ways:

• Dividends: cash the company pays out to shareholders, often quarterly.
• Capital gains: when the share price rises above what you paid and you sell at a profit.

You can also lose money when:

• The share price falls below what you paid and you sell at a loss (capital loss).
• The company’s business weakens, cuts its dividend, or even goes bankrupt.

Thinking like an owner means you ask: “Is this a business I want to own for years?” instead of “Will this go up tomorrow?”

2.2 How Stock Exchanges Work (TSX, TSXV, NYSE, Nasdaq)

Stocks trade on organized marketplaces called stock exchanges. In Canada, the main ones you’ll see are:

• TSX (Toronto Stock Exchange): large, established companies (banks, energy, telecom, etc.).
• TSXV (TSX Venture Exchange): smaller, earlier-stage companies, often more volatile.

You’ll also often buy US-listed stocks on:

• NYSE (New York Stock Exchange).
• Nasdaq (heavier in tech and growth names).

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