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### Making Money on Stocks: A Comprehensive Guide
Investing in stocks can be a powerful way to build wealth over time. While it involves risks, the potential for high returns makes it an attractive option for individuals looking to grow their financial portfolios. Here, we explore the fundamental concepts, strategies, and best practices for making money in the stock market.
#### Understanding Stocks
At its core, a stock represents ownership in a company. When you purchase shares of stock, you are buying a piece of that company. Stocks are traded on stock exchanges, and their prices fluctuate based on supply and demand dynamics. In essence, you can earn money through capital appreciation, dividends, or a combination of both.
1. **Capital Appreciation:** This is the increase in the share price over time. If you buy a stock at $50 and it rises to $75, your profit is the difference, minus any transaction fees.
2. **Dividends:** Some companies return a portion of their profits to sha
