You don't have to continue paying for the stock. Once you buy it, it is all yours. In fact most stocks will pay you (that's the idea). When the company earns income it will often divide a portion of the income equally among all of the shares and pay it out (called a "dividend"). If you own the shares, the company will send this money to you (usually via direct deposit to your brokerage account).
Also over time most companies grow larger and become more profitable. The dividend checks get bigger and consequently there becomes a higher demand for your shares of stock. This pushes the stock price higher so that you can sell your investment for a profit.
Also each share of stock you own entitles you to one vote for important company decisions. As a part owner (shareholder) you can have a voice and elect the "Board of Directors" who are responsible for hiring the chief executives who in turn run the company. The board of directors also decides how much of the company's profits will be paid out as dividends to you the shareholder vs how much will be kept within the company in order to grow the company and make your shares more valuable.
You're able to purchase stock online without taking a trip to the actual exchanges. And 99.9% of the time it won't involve a piece of paper - everything is handled digitally through online brokers nowadays.
Stock is simply ownership in a company. In a normal stock purchase you have no financial or operational responsibilities after making the initial purchases (other than paying income taxes on profits). There are some exceptions to this rule, such as the more complex trading strategies of short selling and options. However you wouldn't dabble in these as a beginner (hopefully).
Nothing happens until you sell your stock, in which case the proceeds are deposited into your brokerage account.
Here is what it means to own stock:
Whoever owns the shares of stock are the owners of the public company, no one else. When you buy a share of stock, you are then one of the owners of that company. It could be any of over 13,000 companies that are traded with stock on the open market such as McDonald’s, Coca-Cola, Amazon.com, Ford, Krogers, your local bakery or electric company.
As a company earns money, it becomes more valuable and this value is reflected in the price of its shares on the open market. You can collect this increase in value when you sell your shares for more than you paid for them.
The company’s board of directors makes the major company decisions and decides what to do with its net earnings.
?Some or all of the earnings may be re-invested in the company so it can grow, open new stores or make repairs. When this is done, the earnings money is used up but the company is more valuable by that same amount.
The per share price, having increased because of the earnings, retain that increase when the earnings are re-invested in the company.
?Some or all of the earnings may be given directly to the shareholders and this is called a dividend. They just mail you a check or send the money to your brokerage account. This makes the price of the stock decrease by the same amount as the dividend, so you have the same value in the total of stock and dividends.
Since you are an owner of the company, the members of the board of directors work for you. You can inform the board of your ideas, concerns or recommendations and these carry the weight of your shares.
Each year there is an election and you can vote for the board positions and some special rulings, one vote for each share that you own. If you own at least 51% of the shares then your vote always wins in the election.
You are also protected when you own stock. For instance, if your company gets sued and loses more than it can pay, the law cannot come to you, one of the owners, and confiscate your house or other property. The shares may become worthless, but that is all you can lose.
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If you buy stock hoping that you can sell it for a quick profit because of the daily or monthly swings in price, then you are gambling rather than investing. You are trying to guess better than the public, including professionals, how the price will change.
To truly invest, choose a company that has steady earnings each year instead of losses. If your company has very little long term debt, it will likely not get into financial trouble.
If you buy these quality stocks and hold on to them for a period of time, the share prices will go up for a real reason - the companies are earning money every year and becoming more valuable. This is not gambling; you are owner of a money making business.
If you save a portion of your income each payday and as it accumulates invest in stocks, over the course of several years you can grow very wealthy indeed. It is like hiring someone to get a job and earn money for you, and then using that money to hire more workers. Your money grows exponentially.
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To start buying or selling stocks, you will need to open an account with a brokerage house such as Scottrade or TD Ameritrade. They are required to have you fill out some forms. You must put money into your account before you can begin to order trades.
You select the stock you wish to own and place your order with the brokerage either by phone or online electronically. The brokerage makes the trade for you at the stock exchange, usually within seconds.
The shares that you buy are kept on file at the brokerage. Many companies no longer issue certificates for shares but keep track electronically.
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Okay, let's say I take a trip to the NYSE or NASDAQ or whatever and buy 10 stocks in Company X, Company Y, and Company Z. What happens after? Do I pay per quarter or do I just have a piece of paper that I can claim to own each. Just asking...I'm a beginner in this...
