The Stock Exchange is a market where the purchases and sales of shares and bonds are made available by publicly traded companies.
Shares are small parts that companies put up for sale, in exchange for an investment in their activities. Investors, known as shareholders, become owners of the part they acquire. That is why there is the Stock Exchange, where these negotiations take place.
Stock Exchange in Brazil
The Stock Exchange in Brazil is currently called B3 and is present in the city of São Paulo better known as BM & FBOVESPA, junction of the Commodities and Futures Exchange (BM&F) and the São Paulo Stock Exchange (Bovespa).
Bovespa has a performance indicator known as Ibovespa, which measures the aggregate volume of companies that have the largest turnover on the Stock Exchange.
How the Stock Exchange Works
The shares are traded on the Stock Exchange by companies as a way of raising funds for their own investment. This happens in the so-called Primary Market, that is, where the actions of a company originate.
After the shares are “sold”, they are negotiable, therefore, whoever bought a share and it has increased its quotation value, it is possible to “resell” it to other investors who are interested in the stock market.
The relationship between investors is only possible through stock brokers, which are authorized and registered on the Stock Exchange, and disclose stock offers, as well as bonds or funds.
In addition to shares, the Exchange also trades other investments, such as fixed income, commodities (Commodities) and Securities.
The main objectives of a stock exchange are to maintain an adequate meeting place for buyers and sellers, in addition to maintaining security and transparency in the transactions carried out.
How to invest in shares on the Stock Exchange
To invest in any stock exchange product you need to have an account with a stockbroker or a bank. It is through these means that we can carry out the purchase and sale of shares.
The shares are investments of variable income, which can generate from profits to losses. In addition, there are two types of shares: Common (ON), where shareholders have the right to vote at company meetings and Preferential (PN), which do not have the right to vote, but have preference in receiving dividends.
With the company’s profits, shareholders receive dividends. In the same way it is possible to sell the shares when the price is above what was purchased.
With this it is possible to follow the steps to follow to start acquiring shares on the Stock Exchange:
1. Open an account with a broker or bank
The first step is to open an account so that stock purchase and sale transactions can be made. After the account is opened, the broker registers the investor on the stock exchange.
2. Perform the transactions and follow through the Home Broker
Currently, brokers offer Home Broker, a system in which it is possible to carry out transactions by computer, quickly and safely, in addition to being able to keep pace with investments.
3. Always be aware of the risks
Investing in variable income is a job that requires a lot of attention, as there is a chance of losing a lot of money on stocks. It is recommended that you are always studying and preparing yourself, as this is the profile of the best investors on the Stock Exchange.
Operating costs of equity investments
When investing in shares through a broker, there will be operating costs that can reduce the return on investment.
- Brokerage fee: charged by brokers to carry out transactions;
- Fees fee: charged by Bovespa and CBLC (Companhia Brasileira de Liquidação e Custódia) for each type of operation;
- Custody fee: this fee is charged by CBLC to keep the shares.
In addition to these, there is also the Income Tax rate, due to the profitability of the shares, especially when they are sold. In this case, the IR is not withheld at the source, it is necessary to appear in the declaration.