
Shake'n'bake
|
I will try to explain it very simply. There are people who want to buy a stock, they are the bidders, and their are people who already own the stock, who want to sell it, they are the sellers. Let's say that a stock is selling for around $1.00 per share. There may be 10 people who all want to buy 100 shares each, for $1.00 per share, there are also another 10 people who want to buy 100 shares each, but they only want to pay $.99 for each share, and there may be others who want to pay even less. Now let's say that there is one seller, who is offering 100 shares for sale, but he wants $1.01 for each share. Than there are another 2 sellers who are offering 100 shares each, but they want $1.02 for each share. Then there are still other sellers, but they want even more for their shares. Both the bidders and the sellers have set a price that they are willing to trade at. Now let's say that one of the bidders gets a little nervous, after all, there is only one seller willing to sell his shares for $1.01. So one of the bidders goes ahead and buys the shares at $1.01. Now the lowest price that a seller is willing to accept is $1.02. Now a couple of the other bidders may decide that they lost out on the shares at $1.01, so they don't want to miss out on the shares being offered at $1.02, so they go ahead and buy the shares being offered at $1.02. Now the lowest price that any seller is willing to accept has gone up to $1.03. At this point the buyers may decide to either increase the price they are offering, or they can just buy up the stocks being offered at $1.03. Or it could be that the bidders will refuse to increase their bids. Eventually either the bidders will increase their offer, or the sellers will lower the price that they are asking. If there are more buyers than there are sellers, the price will tend to go up as the people willing to sell at the lower price will sell their shares, leaving only the higher priced shares. If there are more sellers than there are buyers, the price will tend to go down as the sellers sell their shares to the higher bidders, and only the lower bidders are left. The market is made up of buyers and sellers, each setting a price at which they are willing to trade, they can raise or lower the price at which they are willing to trade whenever they want. When a buyer and seller agree upon a price, a sale is made. People trading stocks use what is called Level 2 quotes, this tells them how many shares are offered on each side of the trade, and at what price. Basically, that's what makes stock prices go up and down. |

mark_2005_london
 |
This is a rather dumb question if you don't mind me saying, unless you are a kid in which case you are forgiven.
The markets fluctuate according to volumes traded, nervousness about interest rates, rumours, take-overs, business results, the list is probably endless |

Nirmal K
|
A stock's price of future incomes. Given this fact a stock's price can move up because of various reasons including
1) When interest rate decreases and thus the discount rate decreases
2) The market expects the company's earnings could be higher than levels that is projected at present
3) Market expects some news flow like new projects, mergers, take over etc..
These are just examples there are n number of reasons |

1+1=2
 |
This is not a question that can be quickly answered, but in essence when stocks trade in the secondary market there is supply and demand. If a person wants to buy shares of a stock and the market is trading at a particular price, they can buy at a higher price to make sure they get shares. This causes the price to go higher. |