Introduction

Before making your first trade, it is essential to understand what a stock is, how the market works, and the basic mechanics behind trading. This foundational knowledge sets the stage for smarter decisions and long-term success.

1. What Is Money?

● Definition: Money is a tool used to buy and sell. Instead of bartering (e.g., cows for rice), we use money for transactions.

● Forms: Includes cash, credit cards, and digital wallets.

● Function: Enables exchange between people and businesses—even strangers.

​● Example: Instead of trading 700 bullhorns for an iPhone, you use money.

2. What Is a Company?

● ​Definition: A group of people working together to make or sell something.

● Examples:

○ Apple = phones
○ Nike = shoes
○ McDonald's = burgers
○ OVTLYR = software

● ​Why It Matters: Companies need capital to grow, and they may raise money by selling parts of ownership (equity).

3. What Is a Stock?

● ​Definition: A stock is a small piece of a company that you can own. When you own a stock, you’re a shareholder.

● ​Function: Allows companies to raise money by selling ownership in return for potential profit.

● ​Shareholder Role: You're not in control, but you benefit (or suffer) based on company performance.

​● ​Dividends: Some companies share profits with shareholders through dividends.

4. Why Do People Buy Stocks?

● To make money if the stock price rises.

● To earn dividend income.

● To build long-term wealth (e.g., for retirement).

● To feel involved in companies they believe in.

● To potentially outperform low bank interest rates.
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5. How Do Stocks Move?

● Price Goes Up: When many people want to buy a stock.

● Price Goes Down: When many people want to sell a stock.

● Influencing Factors:

○ News (e.g., earnings reports)
○ Emotions (e.g., fear, greed)
○ World events (e.g., elections, wars)
○ Rumors and social media

“Profits follow price.”
If the stock goes up, you make money. If it goes down, you lose money.

6. What Is the Stock Market?

● Definition: A place where stocks are bought and sold.

● Analogy: Like an online farmer’s market, buyers and sellers come together to exchange.

● Function: Fully digital, instant transactions.

● Examples of Markets: NYSE, NASDAQ

7. What Is a Ticker Symbol?

● Definition: A stock’s shorthand symbol used to identify it.

● Format: 1 to 5 letters (e.g., AAPL for Apple, DIS for Disney).

● How to Find It:

○ Search “McDonald’s stock” on Google = MCD
○ Search “Disney stock” = DIS

● Use: Type into trading platforms to view and trade.

8. How to Trade Today vs. Back Then

● Before:

○ Needed to call or visit a broker
○ $50–100+ per trade
○ Delay and friction

● Now:

○ Just a few clicks
○ Often commission-free
○ Accessible to anyone with a smartphone

9. Trading Is a Market Auction

● Stocks are priced at what someone is willing to pay right now.

● The concept of “fair value” is subjective.

● Prices change constantly based on supply and demand.

● The market is an auction, not a calculator.

10. Stock Ownership Is Digital

● No physical certificates needed.

● All ownership is tracked digitally.

● Some platforms still offer framed shares, but it’s outdated and inefficient.

This concludes the first core lesson of OVTLYR University. It's designed to give you the absolute baseline understanding before we get into execution, strategies, and psychology.

In the next lesson, we’ll dive into how trading platforms work, what brokers actually do, and how to place your first trade.