Understand stocks, bonds and index funds in plain language.
Lesson 1 of 4
A stock is a small slice of ownership in a company. If the company grows its profits, your slice tends to be worth more. If it struggles, your slice is worth less.
Stock prices move every day based on what buyers and sellers think a company's future is worth. Over short periods that can look random. Over long periods prices tend to follow profits.
Pick a start year and a company, then compare it with the S&P 500 using real history.
Invest $1,000 in January of
Company
$4,685
S&P 500 fund today
$355
Hawaiian Electric Industries today
Some single companies beat the index by a mile. Others lost most of their value. The hard part is that nobody knows in advance which is which, which is why most people own the whole market.
Monthly total return with dividends reinvested, from market data on this site. Past results are history, not a forecast.
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For learning only. Kuleana Finance explains how money works. It does not tell anyone what to buy or sell.