A stock is a fractional ownership stake in a public company. When you buy shares in a company, the hope is that over time, the stock will increase in value, so you can sell them for more than you paid. Many companies issue stock to raise money to expand, pay off debt or develop new products. Investors can purchase individual stocks through a stockbroker or invest in mutual funds that hold many stocks, or both.

Stock prices rise and fall throughout the day, depending on supply and demand for the underlying company’s goods or services. As a result, there is no such thing as a guaranteed return on investment. Despite this risk, over the long term, most stocks outperform other asset classes like bonds or real estate, including taking inflation into account.

If you own stocks, you can make money in two ways: through capital gains, which occur when you sell your shares for more than you bought them; and through dividends, which are regular payments made to shareholders. Many people invest in stocks because they want to grow their wealth and outpace inflation over time.

There are a number of things that can affect stock prices, from bad earnings reports to political or economic events. Some of these can cause short-term spikes in prices; others may have a long-term impact. One of the best ways to minimize risks and maximize returns is to diversify, or spread out your investments across different types of stocks and industries.

Whether you’re investing in an individual stock or in an index fund, you can find information about each company by looking up its ticker symbol. The symbol is a combination of up to five letters that identifies the company on stock charts and in newspaper listings. You can also find company profiles, key ratios and valuation data through the Market Data Center, a free online resource run by FINRA. Many brokerage firms offer research from their own analysts and outside sources as well, but this may come with a price tag.

When you choose which companies to invest in, it’s helpful to understand a company’s qualitative strengths and weaknesses, as well as its quantitative metrics. For example, a company with a defensible economic moat can resist competition from new players in its industry, and companies with large user bases benefit from network effects that make it easier to attract and retain customers.

You can start by finding a stock or index fund that matches your goals, and then look at how those investments performed over the past year. You can also use an evaluation tool like NerdWallet’s best online brokers and robo-advisors to find the best options for your situation. Our ratings take into account 15 factors, including fees and minimums, investment choices, customer service and mobile apps. NerdWallet’s team of personal finance experts has also created a scorecard for each, which helps you evaluate providers based on the features that matter most to you.