The stock market works, like any other market, by matching buyers with sellers. Stock exchanges like the Nasdaq or NYSE automate this process in exchange for fees. To avoid the costs and risks associated with physically exchanging paper certificates, most securities transactions in the US go through the Depository Trust and Clearing Corporation (DTCC), which holds and transfers them on behalf of traders. In addition to actual stocks, the market also includes derivatives like futures (an agreement to buy stocks at a specified price in the future), options (similar to futures but without an obligation to buy), fractional shares or short positions (borrowing shares and immediately selling them).

Like any other speculative market, stock prices depend on the expected future price. Any bad news about the company will make some shareholders sell their shares, lowering the price. Unexpected profits or good economic conditions lead to higher values. Companies can affect the price of their stocks with buybacks or issuing new shares. Dividends also play a role, acting as a floor where selling below a certain price is only worth it when anticipating a crash.
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