What Determines a Stock Price?
Do you know what determines a stock price? There are a lot of complex formulas that affect a stock price, but in essence…
Price movement of a stock is caused by supply and demand in the market. If more people want to buy than sell then the price goes up, the inverse is true if more people want to sell a stock than buy, as surplus drives the price down.
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Price movement can even be moved by people emotions.
To help you understand what determines a stock price, what affects it and defines it, I decided to create an infographic that breaks it all down.
Click on the image below to see a larger view…
Conclusion
The one thing we do know for sure is that stocks are volatile and prices can change rapidly. Always remember stock price fluctuations are dictated by supply and demand in the market, which reflect investor’s sentiments and evaluation of the present and future value of a stock.
There are many theories that try to explain the way stock prices move the way they do but no single theory explains everything.
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Hey Everyone,
As many of you already know I grew up in a middle class family and didn't have many luxuries. But through trading I was able to change my circumstances --not just for me -- but for my parents as well. I now want to help you and thousands of other people from all around the world achieve similar results!
Which is why I've launched my Trading Challenge. I’m extremely determined to create a millionaire trader out of one my students and hopefully it will be you.
So when you get a chance make sure you check it out.
PS: Don’t forget to check out my 30 Day Bootcamp, it will teach you everything you need to know about trading.
Tim, thanks for sharing this valuble info with me and giving me the opportunity to learn from the best! I need some more training on this as well as analyzing stocks, how to get in and out…buy and sell on my e-trade account. I use cash app to trade because it’s simpler and I’m growing my small account!
Hi Tim, I have been taking courses for a while now unfortunately getting better at times and also confused. The last company I was with, you are in a class of 25 people, all of us trying hard to follow the trainer….and not making it, not the greatest way to learn…but expensive. If i could mention the company in my early days who taught us RED and GREEN lights when to trade…..I have still got the books and the DVD,s. So it is like what you have already stated Tim, you have to weed out the bad from the good. ….Many Thanks……Les
NEVER follow another trader’s alerts! Instead, learn to be self-sufficient. All my top students put in the time and effort over years to develop their skills. There is no easy button.
Knowledge supports growth and development.
thank you Tim!
My question: Why doesn’t anyone look at cashflow? Yes, I am a real estate investor and thats my main criteria, but information on that and showing how positive they are each quarter I would think is more valuable. Someone with a 20% profit margin is better than someone with a better earning ratio but only 5% cashflow. However, figuring out how to read that aspect is not so easy.
Hi Tim, is there another way of learning with you without going thru the gazillion videos you made available? I’m asking bcz I’d like to get started with you but the internet connection in my country isn’t fast and stable enough to warrant going thru your videos…
Excellent Infographic Tim!
We need a followup infographic on your strategy on Penny Stocks 🙂