How the Market Actually Works

Owning a share is one thing; actually buying and selling one is another. This module covers the trading mechanics a beginner runs into the first time they open a broker app — what a bid-ask spread is, the difference between a market and a limit order, and what happens to your gains once tax is taken out.

4 chapters · about 17 minutes

1. 2.1What Is the Bid-Ask Spread? Two Prices for One Share4 min

   Why does a stock show two different prices at the same moment?

2. 2.2Market Orders vs. Limit Orders: Two Ways to Buy a Share5 min

   When you tap "buy", what are you actually choosing — and what are you giving up?

3. 2.3What Is the Pre-Open Session? Trading Before the Bell4 min

   Riya's order sat untouched for 45 minutes, then filled at a price she never saw. Where was it?

4. 2.4Capital Gains Tax, Explained Simply: What You Actually Keep4 min

   Riya sold at a profit and the money that arrived wasn't the money she'd calculated. Where did the rest go?