What is traded in the stock market?
In the stock market there are an infinite number of financial instruments to buy and sell, but in general they are divided into two categories: the variable income market (stocks) and the fixed income market (debt).
In the debt or fixed income market, companies and governments borrow from investors, who are offered an interest rate on their money. They do this through a bond issue.
It is called fixed income, because from the moment investors buy that bond, they know how much interest it will give them and for how long. This market, the debt market, is considered one of the safest to invest.
As for the stock or variable income market, what happens is that companies offer a part of their company through the issuance of shares. The person or company that buys those shares becomes an investor in the company that issued them.
The price of the shares depends on various factors such as the financial health of the company, its growth prospects, and the economic and political environment.
It is called variable income, because the price of the shares fluctuates every day, from Monday to Friday that the market operates. For example, someone who bought Alsea shares a year ago for 40 pesos could sell it today for 58 pesos, obtaining a 45% profit. On the contrary, whoever bought Televisa shares a year ago at 32.27 pesos and today decided to sell it, would have to do so at 17.21 pesos, that is, they would lose 47%.
Since the investor who buys shares today does not know how much they will be worth tomorrow, in a week, or in a year, the equity or stock market is considered a risky investment.