From Wall Street titans to retirees worried about whether their investments can keep up with inflation, the equity market’s influence touches us all, shaping everything from individual retirement plans to national economic policies. The equity market, often called the stock market, is the lifeblood of modern capitalism. In 2024, the global equity market was valued at over $100 trillion, according to the World Federation of Exchanges. This colossal figure is not just the cumulative value of publicly traded companies but also tied to the hopes, fears, and financial futures of millions of investors worldwide.
Companies use the equity market to raise capital for growth and expansion by offering shares to investors. In return, investors have partial ownership of these companies with the potential to profit from their future performance through dividends or stock price appreciation.
But how does the equity market function, and why…
