Aug 20, 2020 · A market economy functions under the laws of supply and demand. It is characterized by private ownership, freedom of choice, self-interest, optimized buying and selling platforms, competition, and limited government intervention. Competition drives the market economy as it optimizes efficiency and innovation.
Stocks exist for companies to make money, but it is clearly true that stock markets also make investors money. However, as with any investment, there is an inverse relationship between return and risk. Stock investments are one of the riskiest investments and, accordingly, have one of the highest returns on readily available investments.