If you always switch economic news when you start talking about stocks and their quotes, or if you are new to the exchange and do not know where to start, then it will be useful for you to understand what a stock price is and how it is determined?
Instructions
Step 1
Be aware right away that a quote and a stock price are one and the same. This is the most important characteristic of the share price. This criterion determines the attractiveness of a stock for an investor to buy.
So, the stock price is the immediate market price of the stock itself in a fixed period of time. In the form of a formula, the share price is defined as the ratio of the share price to 100 units of monetary value. That is, the share price consists of two main values: its market value and its par value.
Step 2
To do this, you can use the simplest formula:
Here K (p) is the market value of your share and H (p) is the par value. It's simple, just plug the numbers of your stock into this formula and find out its quote.
The market value of any stock always depends on the balance of supply and demand in the market. This mechanism works everywhere in a market economy.
Step 3
Accordingly, you can even establish a trend of growth or decline in the stock price. Indeed, there are constant fluctuations in the market, and the quotation rate does not stand still, but changes depending on the economic situation in the world. Such trends can be both short-term (day, week) and long-term (quarter, year). All this is important for analyzing the position of your shares in the securities market in comparison with competing positions.
Step 4
Investing money in stocks always carries a certain amount of risk. But on the other hand, this is a definite test of professionalism. With stocks, as well as with cards, one should not fall into the sin of gambling. This is rather a negative trait for the stock market, but stress resistance and "iron" nerves will definitely come in handy.
Step 5
Your success in the securities market and, accordingly, your profit is the result of your analytical skills, the ability to predict changes in the financial world and an intuitive understanding of the economic laws of the market. In addition, it will not be superfluous to read specialized literature if you seriously decided to realize your opportunities in the stock market.
