Investing 101

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When you created a lemonade stand or sold Rainbow Loom bracelets as a kid, you were investing your money. Investing is simply the act of using money or resources with the goal of making more money in the future.


For example, if you started a bracelet business, you would have to purchase the materials necessary for making the bracelets. This could include the Rainbow Loom strings, the board, and the pick. This initial use of money was an investment; you used money with the goal of making even more money from the business.

Just like you can invest in a lemonade stand or bracelet business, you can invest in companies. At a basic level, when you invest in a company, you are giving them money in exchange for partial ownership of the company.

You read that right. When you invest in Apple, you are a partial owner of the company. That’s pretty cool. If Apple becomes a more valuable company, your slice of ownership also becomes more valuable. You could then sell that slice of ownership for money.

We’ll talk about what makes a company valuable later. For now, just remember that investing is simply the act of using money with the goal of making more money, and when you invest in a company you are receiving partial ownership of that company.


Up next, read about the Risks and Rewards of investing.

Source: Investopedia | Investing

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Disclosure: This is not an offer, solicitation of an offer, or advice to buy or sell securities, or open a brokerage account in any jurisdiction where Alpaca is not registered (Alpaca is registered only in the United States). All investments are subject to investment risks, including possible loss of the principal amount invested.
Disclosure: Alpaca does not make recommendations with regard to fractional share trading, whether to use fractional shares at all, or whether to invest in any specific security. A security's eligibility on the list of fractional shares available for trading is not an endorsement of any of the securities, nor is it intended to convey that such stocks have low risk. Fractional share transactions are executed either on principal or riskless principal basis, and can only be bought or sold with market orders during market orders.
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Brokerage services are provided by Alpaca Securities LLC ("Alpaca”), member FINRA, a wholly-owned subsidiary of AlpacaDB, Inc. Clearing services are provided by Velox Clearing LLC (Velox) and Vision Financial Markets LLC (Vision). All three are members of the Securities Investor Protection Corporation (SIPC), which protects securities customers of its members up to $500,000 (including $250,000 for claims for cash) per customer. Explanatory brochure available upon request or at www.sipc.org.

This is not an offer, solicitation of an offer, or advice to buy or sell securities, or open a brokerage account in any jurisdiction where Alpaca is not registered (Alpaca is registered only in the United States).

View Alpaca's disclosures at: https://alpaca.markets/disclosures

Alpaca does not make recommendations with regard to fractional share trading, whether to use fractional shares at all, or whether to invest in any specific security. A security’s eligibility on the list of fractional shares available for trading is not an endorsement of any of the securities, nor is it intended to convey that such stocks have low risk. Fractional share transactions are executed either on a principal or riskless principal basis, and can only be bought or sold with market orders during normal market hours.

The content on this website is for illustrative and informational purposes only and any historical returns, expected returns or projections are hypothetical in nature. Investing involves risk & investments may lose value, including the loss of principal. Past performance does not guarantee future returns or results. Before investing, carefully consider your investment objectives, time horizon, and overall risk tolerance as well as the information stated in the product offering prospectuses.