One of the original investors sells their shares, but since Hughes Company is small and little known, so he privately bargains with the buyer. This is called over-the-counter market.
I'm looking to get $35 a share.
I will give you $30 a share
As Hughes company grows, they can apply to be traded publicly on the New York Stock Exchange. If approved, the company must pay a yearly fee and publish a financial statement that explains the exact condition of the business every three months.
Stock exchanges are simply places where stocks and bonds of member companies are sold. Prices are determined by their value to the people who wants to buy or sell them, but most often, the price falls between how much the buyer is willing to pay, and the cheapest the seller is willing to sell. Some markets are actual places like the New York Stock Exchange and American Stock Exchange, while others, like NASDAQ have no location and trades take place over computers.
In order to purchase stock, one but be 21 or older and have the money to buy the stock, but the actual buying is done by brokers, who charge a commission, which changes depending on the size of the purchase.
All different kinds of people invest in stocks for all different kinds of reasons, but the main reason is that they make more money than other kinds of investments in the long run.
To buy stock, one might contact a broker for help picking good companies to invest in, or read the financial page of the daily newspaper. Brokers can supply a lot of information about information about the companies one is interested in. Then the broker will buy the stock. The type of stock and when to sell are the investor's decisions. It is important for investors to be well informed, so they should read newspapers and magazines.