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Plain-language guide

Stocks & stock funds

Own a small piece of a business—or many businesses through one fund.

Typical volatility
Medium
Often used for
Long-term growth and investors who can accept price swings
Liquidity
Usually easy to buy or sell while markets are open
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What is it?

A stock can rise when a company grows profits or investors expect better years ahead. It can fall when results disappoint. Broad funds spread the risk across many companies.

HYPOTHETICAL $1,000 EXAMPLE

The same money can move both ways.

Possible gain$1,000 growing 12% becomes $1,120: a $120 gain.

Possible loss$1,000 falling 12% becomes $880: a $120 loss.

Illustration only. Actual outcomes, costs, and taxes will vary.
Educational watchlist

Examples to learn

These are examples—not Council picks or recommendations.

SPY
S&P 500 ETF

Large U.S. companies

QQQ
Nasdaq-100 ETF

Technology-heavy growth companies

AAPL
Apple

One company; more concentrated risk

MSFT
Microsoft

One company; software and cloud exposure

Before investing

What can go wrong?

  • Companies can miss expectations
  • A single stock can lose most of its value
  • Broad markets can decline together
News that matters

Watch these drivers

  • Earnings and revenue
  • Interest-rate expectations
  • Industry competition
  • Economic growth
Learn to decode investment news →
Slow down and ask

Three useful questions

  1. Am I buying one company or a diversified fund?
  2. How long can I leave the money invested?
  3. What would make the business thesis wrong?
Keep comparing

Explore another area.

◆Crypto assetsDigital assets that trade around the clock and can move sharply.⇄Foreign exchangeTrade the value of one currency compared with another.▰Bonds & rate fundsLend money to a government or company and receive interest.