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Why do stock prices go up and down?

Updated: 4/28/2022
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Stock prices go up and down based on the changes in investors' demand for a given corporation's stock. That demand is determined by investors' and potential investors' expectations regarding the company's future profits. If potential investors expect that a corporation will make high enough profits in the future, and they want to share in those profits and are willing to pay the current market price for the stock, they will buy stock in the company. But since there are only a fixed number of shares available for sale at any given time, as more and more new investors want to acquire stock in the same company, its price will be bid up until it gets so expensive that the expected future return no longer justifies the investment required to acquire the stock.

Similarly, if stockholders get information that leads them to expect that the corporation might not do as well as they originally thought (or it looks as if having stock in another company will yield a better return for them), they will try to sell their shares at the market price. But since new investors will not be willing to pay high prices for stock when there is a big risk that the company might perform poorly, and a lot of current stockholders are trying to sell their shares at the same time, the demand for the stock on the part of new investors will be low, and its price will go down.

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Q: Why do stock prices go up and down?
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What are stock quotes?

Stock quotes are prices that are of value in the stock market. It will depend on the daily activities of the business day. The stock market also depend on how much the consumer. The stock market can go up one day, then come down in a few seconds.


If flotation cost go down the cost of new preferred stock will go up or down?

go down


How do you read stock prices?

Stock prices are largely driven by investors expectations of its future earnings.So if prices go up, you could simply say that its because more investors are positive about the relevant companys' earnings.Please note that the stock marketis highly complex, and there is no "one way" of reading the price.For the layman, I would simply say that its an issue of supply and demand. If there are more buyers than sellers, then prices go up. Vice versa./BL


When stock prices are up what does that mean?

It means the value of a company's stock has gone up in dollar(s) and vice versa. A point is usually equal to a dollar in most cases. So, if a company's stock went down by 5 points, it means the value of the company's stock went down by 5 dollar, which reflects the company's value in an open market and that's not a good thing.


What are the benefits of owning stocks?

Owning a stock is sort of like playing the lottery, you can buy them at a low price and hope that they grow and grow. The more money the company you invested in, the more your stocks will go up. Once the stock goes up that you bought you can sell them at a higher price and make a profit. Although the prices of the stocks can go down in which case you will lose a lot of money.

Related questions

Why do stocks go up or down in price?

Stock prices go up or down based on the Demand - Supply theory. Whenever the demand for a stock is more than its supply its prices go up Whenever the supply of a stuck is more than its demand its prices go down


What is a bill market In the stock market?

There is no such thing as a bill market in the Stock market. There are only... A. a bull market in which prices go up B. a bear market in which prices go down C. a crash in which prices go down in a hurry


What happens when stock prices are down?

When stock prices are down, people with lots of money buy up the low priced stocks. They do so in anticipation that the stocks will eventually go back up and they will be able to sell at a nice profit.


How does the stock market effect gas?

If stock us down the economy is weak making gas prices go up so the govt can get money...


What is the relationship between the stock market index and individual company share prices?

it is a kind of disjoint parallel or direct relationship. When the stock market index goes up, the stock prices go up and when the index goes down the individual company stock prices come down. But there may be companies whose prices are going in the opposite direction as compared to the stock market. Just because the stock market is going up it doesn't mean that all company stock prices are going up.The stock price of each and every company is governed by a variety of factors and may move in either direction irrespective of how the overall market is going.


Is there any relationship between gold prices and stock market?

Roughly, yes. When the stock marketis struggling, gold prices will go up.


How do stock prices go up?

I know its because of supply and demand


How does the stock market raise and lower?

The price of stocks is determined by the Demand and Supply theory. When there is a heavy demand for stocks and the supply is less then the prices go up. When there is a heavy supply of stocks and there is less demand then the prices go down. When the price of stocks goes up, the market goes up and when the price of stocks go down the market goes down.


What is meant by the term news?

This term means news about commodities such as goods and so forth.This is how share prices are decided and how the Stock Market functions.The prices go up and down daily.


Does the value pf home prices pretty much go up or down just like the stock market does?

Kinda, stock market prices are persistly moving in comparison to house prices, house prices may change in an area for several reasons. So its not exactly alike but the same idea.


What are stock quotes?

Stock quotes are prices that are of value in the stock market. It will depend on the daily activities of the business day. The stock market also depend on how much the consumer. The stock market can go up one day, then come down in a few seconds.


What is meant by the term commodity news?

This term means news about commodities such as goods and so forth.This is how share prices are decided and how the stock market functions.The prices go up and down daily.