Imagine you find a promising company, believe in its growth potential, and want to share in its success. But you don’t have the capital to start a business from scratch, nor the connections to become a partner. There is an accessible way to do just that: buy a stock on the stock market. It may seem complex, but the mechanism behind it is simpler than many people think.
The problem is that the stock market still carries an air of mystery for most people. Terms like “trading session,” “ticker,” “dividends,” and “volatility” deter those who could benefit from understanding how this system works. This article does not aim to turn you into a trader or promise easy gains — quite the opposite. The idea is to demystify the subject, explain the basics clearly, and help you make more informed decisions.
If you already have a digital account organized and have started understanding fixed income, the next natural step in your financial learning is to comprehend the world of stocks. Let’s start from the beginning.
What is a stock, after all?
A stock is a fraction of a company’s share capital. When a company decides to go public — that is, become a “publicly traded company” — it divides its total value into millions (sometimes billions) of small parts. Each of these parts is a stock.
By purchasing shares of a company, you become a partner in it, proportional to the number of shares you own. This means you have rights to a portion of the profits and, in some classes of shares, voting rights in the company’s strategic decisions.
Types of stocks in Brazil
In Brazil, stocks are mainly classified into two types:
- Common Shares (ON): grant the shareholder voting rights at the company’s general meetings. They are identified by the number 3 at the end of the code, such as PETR3 or VALE3.
- Preferred Shares (PN): generally do not grant voting rights, but offer priority in receiving dividends. They are identified by the number 4, such as PETR4.
There are also Units (like BPAC11), which are deposit certificates representing a set of ON and PN shares. Each company may have its own structures, so it’s always worth consulting the prospectus or available information on B3 and CVM.
What is the stock market and how does it work?
The stock market is the regulated environment where stocks and other financial assets are bought and sold. In Brazil, this environment is the B3 (Brasil, Bolsa, Balcão), located in São Paulo and regulated by the CVM (Comissão de Valores Mobiliários).
Think of the stock market as a large organized market. Instead of fruits and vegetables, what is traded are shares in companies. Prices vary constantly, according to the law of supply and demand — and also with news, companies’ financial results, economic scenarios, monetary policy decisions, among other factors.
How is a stock price formed?
The price is determined by what buyers are willing to pay and what sellers are willing to accept at a given moment. When there is more interest in buying than selling, the price rises. When the opposite happens, the price falls.
This dynamism is what makes variable income different from fixed income: there is no predefined return guarantee. The value of your investment can rise, fall, or fluctuate significantly over time.
How do trading sessions and negotiations work?
The trading session is the period during which trades occur on B3. In 2026, the standard operating hours for the spot market are from 10 am to 5 pm (Brasília time), with an after-market extending for some time. These hours can be adjusted on special dates — always check the official B3 website.
Buy and sell orders are executed through brokerage firms, which are intermediaries authorized by the CVM. Today, with the digitalization of the sector, practically all major brokerages offer apps that allow for simple operation.
Each stock is identified by a ticker (trading code), such as:
- ITUB4 (Itaú Unibanco PN)
- BBAS3 (Banco do Brasil ON)
- WEGE3 (WEG ON)
How does an investor earn (and lose) with stocks?
There are two main ways to get returns when investing in stocks — and it’s essential to understand how losses occur as well.
Price appreciation (capital gain)
If you buy a stock at R$ 20 and it rises to R$ 30, upon selling you have a capital gain of R$ 10 per share. The opposite is also true: if the price falls to R$ 15, you will have a loss of R$ 5 per share if you decide to sell at that moment.
Dividends and Interest on Equity (JCP)
Profitable companies can distribute part of the profit to shareholders. This distribution can occur in the form of:
- Dividends: exempt from Income Tax for individuals in Brazil (rule valid in 2026 — but beware: dividend taxation is a recurring legislative debate topic; follow updates from the Federal Revenue).
- Interest on Equity (JCP): subject to a 15% withholding tax.
Risks you need to know
- Market risk: the price can fall due to macroeconomic, sectorial, or company-specific reasons.
- Liquidity risk: some stocks have low trading volume, making it difficult to sell at the desired price.
- Company risk: a company may face financial problems, scandals, or even bankruptcy.
- Emotional risk: decisions made out of fear or euphoria often harm the investor.
There is no investment in stocks without risk. This is a non-negotiable point.
Taxation: what you need to know
Taxation on stocks in Brazil follows Federal Revenue rules that deserve attention:
- Capital gains on sales above R$ 20,000 per month in the spot market are taxed. Below this amount, there is an exemption for individuals.
- The standard rate for common operations (swing trade) is 15% on net profit.
- For day trade (buying and selling on the same day), the rate is 20%, with no exemption.
- There is a withholding of 0.005% (common operations) and 1% (day trade) as a “fingerprint,” which can be deducted from the tax due.
- The investor is responsible for calculating and collecting the DARF by the last business day of the month following the operation.
As tax rules can change, always consult the official Federal Revenue website (receita.fazenda.gov.br) to confirm the current rates and conditions before operating.
How to start investing in stocks: the basic path
If you want to take the first steps, here is a logical sequence:
- Organize your finances before investing. Stocks are for money you won’t need in the short term. Have an emergency fund already established in daily liquidity products.
- Open an account with a brokerage firm authorized by the CVM. Research fees, platforms, and services. Many brokerages today operate without brokerage fees for stocks, but compare the conditions well. See our guide on digital accounts without fees in 2026 to understand how to evaluate costs in financial products.
- Transfer funds to the brokerage. The process is simple and usually done via TED or Pix.
- Study before buying. Read the companies’ reports available on CVM (cvm.gov.br), follow balance sheets, and understand the sector in which the company operates.
- Start with smaller amounts. It’s not necessary to invest large sums to learn. Many stocks can be bought starting from one unit (fractional lot).
- Diversify over time. Concentrating everything in a single company amplifies the risk.
- Follow, but not obsessively. Checking stock prices several times a day can lead to harmful emotional decisions.
Stocks versus other investments: a basic comparison
Characteristic Stocks Fixed Income (e.g., Treasury Direct) Return Variable, no guarantee Predictable (pre-fixed) or linked to indices Risk High (varies by asset) Generally lower; Treasury has government guarantee Liquidity High (in the spot market) Depends on the product FGC Guarantee No Depends on the product Ideal horizon Medium to long term Varies (options from short to long term) To deepen your knowledge in fixed income and understand how the two worlds complement each other, check out our article on fixed income investments.
Conclusion: knowledge before any decision
The stock market is not a casino nor a get-rich-quick machine. It is a serious, regulated market with a fundamental role in the economy: it allows companies to raise funds to grow and investors to participate in this growth — assuming the inherent risks of this process.
Understanding what a stock is, how the price is formed, what the shareholder’s rights are, and how taxation works is the minimum required before putting any money into this market. Financial education does not eliminate risk, but it significantly reduces the chances of poor decisions based on a lack of information or unrealistic expectations.
Before investing, ask yourself: do I have an emergency fund? Do I understand what I am buying? Can I leave this money invested for at least a few years? If the answer is yes to all three questions, you are on the right path to exploring the stock market with more security and awareness.
> Important note: This article is for educational and informational purposes only. It does not constitute investment advice, an offer to buy or sell any financial asset. Each investor has a different profile, objectives, and risk tolerance. Before making investment decisions, consult a qualified professional or investment advisor duly registered with the CVM (Comissão de Valores Mobiliários). Information on regulation and professional registration is available at cvm.gov.br.
- Open an account with a brokerage firm authorized by the CVM. Research fees, platforms, and services. Many brokerages today operate without brokerage fees for stocks, but compare the conditions well. See our guide on digital accounts without fees in 2026 to understand how to evaluate costs in financial products.
- The standard rate for common operations (swing trade) is 15% on net profit.
- Liquidity risk: some stocks have low trading volume, making it difficult to sell at the desired price.
- Interest on Equity (JCP): subject to a 15% withholding tax.
- Dividends: exempt from Income Tax for individuals in Brazil (rule valid in 2026 — but beware: dividend taxation is a recurring legislative debate topic; follow updates from the Federal Revenue).
- Preferred Shares (PN): generally do not grant voting rights, but offer priority in receiving dividends. They are identified by the number 4, such as PETR4.
