Is this how the stock market works?

Say I buy 4 shares of Google stock (GOOG) for $450 per share using a Scottrade account, totaling $1800. Then the next week the stock rises to $500 per share, totaling my stock worth to $2000. I sell them for that price and make $200 minus Scottrade's transaction fee ($8 I believe?).


Is this basically how the stock market works?

 

I think Scottrade charges $7 a share , i'm guessing that's how it works, but i'm not sure.

 

The stock market is similar to what you described. Usually however, you buy 4 shares for $450, then next week GOOG takes a dive, you sell 4 shares for $400 totaling $1600 and a net loss of over $200.

 

This is really day trading, and it is difficult to get good at it. You can usually do better if you focus on investing your money into a good company and getting some dividends. Then you always have the option to sell if the price rises.

 

basicly yes, but if you are planning on investing your money into stocks, instead of few weeks time line you should prepare investing for several years...one year at least.

 

no.

that is how buying and selling a share of google works.

The stock market is much more intricate. And it involves many advanced things (that even professionals have trouble with).

Why would you buy Google btw?

 

gder is correct...

the stock market is extremely complicated to master. And even the masters lose. Before the internet, the stock market moved more or less based on USA financial news. Now it is global financial market news.
try motley fool or www. fool dot com and also try to use play money ( fake) as previously mentioned above.
seriously, there are a lot of factors. I personally like technical analysis before investing in a stock. BUT I've sold some which I should not have like Carmax because I listened to an analyst or a financial news show.
Always, do your own research on the company you invest in.

good luck.

 

invest solidly in one company, but don't put all your eggs in the same basket...look for companies that arn't at a high risk...like walmart...there stock generally stays the same, but usually gets a boost in 4th quarter and 1st quarter due to holiday sales...just a thought.

 

Basically what you have in mind is Day Trading...That is quite risky as you tend not to go to buy Blue Chips Stocks but fast moving Stocks. Be warned that a lot of people are losing money from day trading. My advice is be cautiuos and dont go for easy money.

 

I was just using Google as a hypothetical. I could probrably make more money off Google using SEO and their adword campaigns than I would buying/selling their stock

How do I find out/tell which companies are "Blue Chip Stocks" and offer dividends? Where and how do I tell the dividend return for these too? I'm assuming it's a certain percentage?

 

Buying and selling stocks short-term isn't a wise financial decision unless you do it full time or with the advice of a stock broker or something. Very risky.

 

You are asking VERY basic questions. Just a suggestion, start with Stock Market for Dummies or somthing. There's a TON of FREE info on the web, in books... Go to Yahoo Finance, or The Motley Fool. Good luck.

 

Then you pay taxes on your short term gain. If you hold it for more than a year before selling, you still pay taxes.. but at a lower rate. Theres no way out of this (in the US)