60
If more people WANT TO buy a stock, it climbs. If more people WANT TO sell a stock, it falls.
That is the correct statement.
But how can that be if there must be someone buying all the stocks that are sold? Are the stocks sold back to the company?
The stock market is an auction. If there are people who are motivated enough to spend what it takes to buy ...
39
One would sell the shares for the same reasons they are sold on the open market. Indeed, many share buybacks are performed on the open market, see how does a share buyback work
Additionally, companies may directly buy back large positions from major investors. If you have a major position, it can be difficult to sell it without affecting the price. In this ...
21
The price was around $60/share when the buyback was announced. My wild guess is that in response to selling off the Speedway brand, they were concerned about investors dumping stock, which could send the price much lower. By offering a minimum price, they can absorb the more "panicky" sellers and keep the price above $56. At the same time, if the ...
16
In terms of transactions, the buy and sell numbers must obviously be equal. We could quibble about numbers of shares vs numbers of people, but that’s not the point.
What is more relevant is the volume of intent. If more seek to sell than seek to buy, then in theory, once all buyers have done their business, sellers would likely lower their selling prices to ...
11
Another consideration, that complements the existing answers, is the role of Market Makers. These are companies that have agreements with the stock exchanges to always provide a "bid" and "ask" price for certain stocks, and so ensure the liquidity of the market.
Their bid price will always be below the "current" price (= the ...
11
The article in your link explains how market prices are determined:
The potential buyers announce a price they would be willing to pay, known as the "bid." The potential sellers announce a price they would be willing to sell, known as the "ask." A market maker in the middle works to create liquidity by facilitating trades between the two ...
8
Your theoretical situation can't lose money numerically, but you may lose value if you picked the wrong company - dividend payments can change, potentially going to zero, and inflation is eating your base value if the share price doesn't increase.
For example, after 50 years, you might have made 50 $ in dividends, and the share value is still 200 $, but ...
7
It isn't money at all. When you start out, you have $100 and no stocks. When you buy the stock, you no longer have any money, but you have X shares of ACME. When the price doubles, you still have no money, and still have X shares of ACME.
However, these shares can now be sold in exchange for $200, rather than the $100 you paid for them. You can keep (all or ...
6
The "price" of a stock is whatever you can buy/sell it for. You can't always trade for the "last" price - it depends on the price that other traders are willing to pay/sell for.
If I make a trade to sell 1 share of Microsoft at $1 will that stock be $1?
In a sense, yes, but the problem is that on an open exchange you can't sell a stock ...
5
JohnFX wrote:
A market order will be executed at whatever the current price is when the trade happens.
This is entirely accurate. But who sets "the current price"?
People entering limit orders.
When you enter a limit buy order, you announcing to the world, "I'm willing to buy at $x."
When you enter a market buy order, you are saying &...
5
The stock market can best be thought of as a huge, multi-seller, multi-buyer, continuous auction.
That's why you see bid and ask prices: buyers are bidding certain prices, while sellers are asking certain prices.
Only when the bid and ask prices match does a transaction occur.
5
Lets imagine i have 200 stocks from a company
Shares of stock; you own shares of stock.
EDIT: shares of (common) stock are nothing more than fractional ownership in the corporation; nothing more. (I mentioned common stock because there are other forms of shares which don't give you voting rights.
can I lose money at any time from holding perpetually?
No, ...
4
The broker and exchange never ceases to exist, implying that I can hold the stocks for an infinite amount of time.
These don't matter. To buy a publicly traded stock you must (practically speaking) go through a broker and they will go through some kind of exchange. But you don't need to hold with a broker; you can request they have you recorded as the ...
4
People rarely in general want to just plain buy a stock (certain examples like Tesla and Gamestop aside.) They want to buy a stock at or below a particular price. Same with selling. A few people just want to sell no matter what, but mostly the issue is wanting to sell at a particular price.
When the price is X, if more people want to buy at X than sell at X, ...
4
To make a few hundred dollars a day, you should start with about $500,000, not $150. In other words, your expectations are totally unrealistic.
You cannot reliably make a >100% return in one day, or even one year. After the fact, yes, you can identify stocks that went from $3 to $7, but it cannot be predicted beforehand.
A high-leverage options strategy ...
4
One possibility is that you have entered a relatively large order, and the brokerage firm has flagged your order to prevent costly fat finger errors. On 2021-06-14 (i.e. the day before you placed your order), only 3482 shares of FRONU were traded (reference, screenshot). Your marketable limit order of 3000 shares is relatively large; it represents 85%+ of ...
3
"The stock price" as it is commonly referred to, says one thing and implies another.
What it says: "This is the most recent transaction price that actually occurred". This would change if a freak transaction occurred for a penny, or for $1B.
What it implies: "This is what the current stock is worth generally speaking, at this moment&...
3
If you have an in-the-money option, then most likely the option is worth more than the difference between the strike and current price.
In that case, it makes more sense to "sell to close" the option and to buy the stock at the current market price. You'll have more profit left over from the premium received than what you "lose" by buying ...
3
Only money is money. That sounds obvious, but must be stated to reinforce the seemingly obvious.
When you buy 20 shares of ACME at $5/share, you've exchanged $100 money for an asset which is those 20 shares.
Now, for some reason, the price of a share is now $10. You still have that asset but it's now worth $200.
But... Walmart won't take those 20 shares of ...
3
For the purpose of your question, stocks are pretty much like anything else you can buy and sell. If you spend $100 on a new washing machine; you no longer have $100 but instead you have a new washing machine. If a friend says that they want the exact washing machine you have and are willing to pay you $200 for it, then you can decide if you want to sell ...
3
Think of it like real estate. If your home value goes up, you can't 'get out' without selling. A home equity loan doesn't count as getting out, because you're not 'out'. Presumably, you would pay back the home equity loan when you sell.
If you own enough stock, a bank can give you a personal loan against those securities, similar to a home equity loan. You ...
3
But when we go to buy or sell, we get only one price or when we search price of a stock we get only one value. Which price is this and how's it calculated?
It is usually the last trade price (i.e. the price that the latest transaction took place at). When markets are closed (after-hours, weekends, or holidays), the price you see is usually the closing price ...
2
From what I can tell, the only way to buy shares in BIBD is using a BIBD brokerage account. It looks like these can only be opened in person at a BIBD branch. Per their financial statements, they have ~700M shares outstanding that are authorised and not yet issued which they could sell - but it looks like if you go through opening an account you'll most ...
2
SOF.BE is a RIC (Refinitiv code) for the Belgian market. The company's primary listing is XBER (Berlin) as SOF.BR. This is the same stocks trading on a different markets (Berlin vs Belgium) in the same currency so the price should be close enough to be identical.
It is usually much easier to find European stocks if you have the ISIN (BE0003717312 for SOF.BE) ...
2
@NotTheGuy explains how it actually works. You might have a stock with hundreds of limit orders out there to buy and sell at defined prices. But orders don't always have to be completed in total. Take this example for an imaginary stock FAKE. These are orders that are out there waiting to be filled:
...
FAKE Sell 100 shares at $53.00
FAKE Sell 25 shares ...
2
There may be some validity to thinking of it in terms of how many people want to buy and sell, but it probably makes more sense to consider how orders are matched.
On the low side you're going to have all the buy orders, each with the associated price the person wants to buy shares for (and the amount of shares they want to buy). On the high side you're ...
2
The number of people buying or selling is irrelevant. IOW, ten people trying to buy 100 shares at "X" has the same effect as one person trying to buy 1,000 shares at "X".
For every transaction, there is a buyer of those shares and a seller of those shares. Their volume is equal and offsetting. So how does price change?
Throughout the ...
2
Your broker should offer some web site menu feature that when selected, it exercises a long contract. If not, you may have to call them to do so.
The intended purpose of options isn't necessarily to acquire long or short positions in the underlying. Their purpose is to make money from them or to avoid loss on something else (hedging). Exercising them is ...
2
You need to understand market depth. Take this stock:
You will notice there are buyer & seller values. If you place a SELL order for 1000 "at market" you will automatically consume stocks from the seller column, i.e. you will get $26.89 for 582 and $27.04 for 418 triggering the last trade price to the the weighted average of those trades ($...
2
Ultimately, what matters is profitability. But when you buy stock, what you're buying is not last year's profit, but next year's profit. If Company X is presently losing money, but you are convinced that their dynamic new CEO is going to turn the company around and next year they'll make a bundle, you would presumably be willing to pay more for the stock ...
Only top voted, non community-wiki answers of a minimum length are eligible
