Google Goes Public

Six years after launching a small, private company named Google Inc. from a garage in Menlo Park, California, the owners have decided to open their doors to the public.

Until last week, Google -- best known for its Internet search engine -- was exclusively owned by its executives, employees, and a few private investors. Now, nearly 20 million shares of the company are being bought and sold by the general public through the stock exchange called NASDAQ, the National Association of Securities Dealers.

Although the Initial Public Offering (IPO) was plagued with obstacles, the shares became available at $85 each on Wednesday, August 18, 2004. Nearly a week later, shares are selling for over $100. As a result, Google and its selling shareholders have raised over $1.66 billion -- making it the third biggest IPO this year and among the largest in history.

Why would a private company choose to go public? Often the reason is tied to economics. Going public can bring in new investors, meaning more money flow into the company. This financial boost can then be used for things like improving the company's technology or reaching new locations.

Investors are rewarded by getting a slice of the company's profits. Basically, when the company does well, you do well.

Of course, the opposite is also true -- when they lose, you lose. The company's products could become obsolete or poor management could lead to bankruptcy.

Some investors find that stock trading is worth the risks. After all, the extra income can be used to pay for college, professional training, or help launch a new business.

So how does someone go about buying stocks? That's the question you'll answer this week, as you explore Wall Street and learn how to research and invest smartly in the stock market.

Stock Market Basics

Get a good overview of the stock market at a ThinkQuest site called, EduStock. Click Visit Site to enter.

Begin in The Stock Market section. Read the Introduction, then click Next to move through the pages or use the menu on the left-hand side.

Discover how shares in a company were traded in The Beginning and How It Works today. What are the three big American stock exchanges called? Can you describe how the stock market helps support the national and global economy? How exactly does an individual investor become an active player?

Now find out what Mutual Funds are, how the Rules of the stock market work, how Crashes can affect the economy, and what influences Market Trends.

What rules are in place that help protect shareholders? In what ways do investors, and consumers, affect share prices? In what ways can a company influence the market?

Next, find out more about What Is a Stock? and the Types of Stocks that can be traded.

What are the four levels of stocks you can purchase? What factors should be considered before investing in a company? How exactly are common stocks different from preferred stocks?

While anyone with a little extra cash can play the market, the actual Buying & Selling of Stocks, Tracking, and keeping a few Stock Tricks up the sleeve are part of a fairly specialized profession. Using some of this insight, how can the daily newspaper help the general public keep track of a particular company and its stock?

Before leaving this site, review some of the Company Profiles to get an idea of what kinds of things -- such as history, leadership, innovation, marketing success, etc. -- investors consider before buying stock.

Wanna Trade Like the Pros?

Now let's go beyond the basics and step deeper into the stock market realm at StockQuest, starting with the Stock Guide.

Browse through some of the sections to learn more about Stock Dividends, Stock Splits, and Holders' Rights.

As you may have already figured out, different investors approach the stock market in different ways. For example, more experienced investors may concentrate on Cyclical Stocks, while others may stick with the more predictable Blue Chip Stocks.

In what ways are Income Stocks different from Tech Stocks? How does investing in Foreign Stocks differ from domestic trading?

Make sure you understand a few more basics of stock trading before leaving this section -- Growth and Value, Market Cap, and the P/E Growth Ration.

What exactly is the P/E Ratio, and how can it help an investor make smart choices? What else should an investor consider?

The StockQuest site has a lot more great information to explore. So, if you have time in class or on your own, find out how you can Get Started in investing in your own future, get more information about how Trading works, and compare some of the different investment Strategies people use.

You can also learn more about the U.S. Market and World Markets here, and you can try your hand as a stock broker in the Global Stock Game.

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Newspaper Activities

Find the stock market listings in Targetnewspaper. Pick a few companies to follow over the next few weeks or months, and record their stock market gains or losses, as well as any news that appears about them. Keep a look out for any news that could affect their related industries, competitiveness, reputations, etc. Which company that you tracked performed the best over that time period? Which performed the worst? What factors or events do you think may have affected each company's stock performance?