Introduction to the stock  market and its mechanisms               

The stock exchange, which is a financial institution 

concerned with regulating and facilitating trading in 

stocks and securities, is considered one of the most 

prominent elements in the global financial system. With the development of financial markets, the stock market has become of great importance in stimulating economic growth and providing financing for companies. However, investors should understand the risks associated with 

thestock exchange:

Price fluctuations: Stocks or assets listed on the stock exchange can experience sharp price fluctuations as a result of political, economic, or even technical news events.

Loss of capital: While the stock market can provide opportunities for profits, it also carries the chance of losing part or all of the invested capital.

Financial crises: Financial markets may be affected by global financial crises, such as the global financial crisis in 2008, leading to a sharp decline in the value of assets.

Spin-off effects: Negative events in a particular sector or economy can affect the performance of other markets or even entire global markets.

Strategies for controlling risks in the stock market

Knowing the risks associated with the stock market, investors can adopt strategies to control and reduce these risks:

Diversification: Diversification is one of the most prominent strategies that investors can follow. By distributing their investments across different assets and sectors, the negative impact of poor performance in a particular sector can be reduced.

Fundamental and Technical Analysis: Using fundamental analysis to examine the health and performance of companies, and technical analysis to understand price patterns and market trends, can help make more conservative investment decisions.

Maintaining liquidity: It is always wise for investors to maintain a portion of their investments in the form of liquidity (cash) to achieve reserve and react quickly when needed.

Continue learning: The stock market and financial markets are constantly evolving. By following market news and ongoing training, investors can update their knowledge and improve their investment decisions.

Ultimately, the stock market represents a great opportunity for investors to achieve returns, but it is always necessary to understand the risks associated with it and take action to mitigate them.