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Which of the following is a true statement about the call option?
It is a way for investors to avoid paying a future higher price of a stock. NOVANET
How are prices determined in stock market?
The prices you see in the stock marketare the 'market price' or 'street price'. It's basically the averages of what people buy and sell it at. ASX for example have people selling stocks higher or lower than the market price, so really; that's a guide of what to buy it at.
How do stocks get their prices?
The stock market connects offer and demand, which means that investors who willing to sell find a demand of others in the stock market. If the price of a stock is $40.00 and someone wants to buy a certain amount of stocks he has to pay a higher price because of the offers lying above that level. If one wanted to sell the stocks for a lower price this would have already happened at a stock price of 40.00.Therefore, the cheapest offer which can be found lies slightly above 40.00 at, for example 40.02. This is the price the investor has to pay. This results in an increase in the stock price. If a stock is little popular there may be a lower offer of stocks what can make the cheapest offer much higher at, for example, 40.40. A purchase of stocks would cause an increase in the price of 1%. Therefore it is necessary to use order limits and tell your bank that you won't pay more than a certain price (40.05) in order not to pay a too high price.
Explain what is ADR for stock Will it shows strength of stock if it is greater than 60 If it is 20 what does it mean it is weak stock?
See the explanation of American depository Receipt at: http://wiki.answers.com/Q/What_does_ADR_stands_for The actual price of the ADR means nothing in itself, just like the price of a stock doesn't. The number of shares, among other things, makes the stock price higher or lower without changing any real value. (A stock with a float of say 100 shares and a price of $100 as share, would be the same if the float was 1,000 shares but the price would then be indicated as $10 a share).
Can inflation lead to lower interest rates and higher stock prices?
False
Is the price of the stock sharp higher or lower?
The price of the stock is sharply higher.
How can I strategically sell stock and buy it back at a lower price to maximize profits?
One strategy to maximize profits by selling stock at a higher price and buying it back at a lower price is called "short selling." This involves borrowing stock from a broker and selling it at the current high price. Then, when the stock price drops, you can buy it back at the lower price and return it to the broker, pocketing the difference as profit. However, short selling carries risks and requires careful timing and market analysis.
How can I profit from a decrease in the price of a stock by selling to open a put option?
You can profit from a decrease in the price of a stock by selling to open a put option because you receive a premium upfront for agreeing to buy the stock at a specific price in the future. If the stock price decreases below the agreed-upon price, you can buy the stock at the lower market price and then sell it at the higher agreed-upon price, making a profit.
What is it called when a stock is sold at a higher price than the purchase price?
When a stock is sold at a higher price than the purchase price, it is called a capital gain.
Which of the following is a true statement about the call option?
It is a way for investors to avoid paying a future higher price of a stock. NOVANET
What is the best time to exercise stock options for maximum financial benefit?
The best time to exercise stock options for maximum financial benefit is typically when the stock price is higher than the exercise price of the options. This allows you to buy the stock at a lower price and potentially sell it at a higher price, maximizing your profit. It's important to consider factors like taxes and market conditions before making a decision.
How do call options make money for investors?
Call options make money for investors by giving them the right to buy a stock at a predetermined price within a specific time frame. If the stock price goes up, the investor can exercise the option to buy the stock at the lower price and then sell it at the higher market price, making a profit.
What is a stock option and how do you use it?
Stock options allow you to buy stock in a company at a certain price, no matter what the price of the stock is currently. There is usually a time period associated with the offer. Sometimes this could be a sweet deal (if the stock is currently higher than the option) to worthless (if the option price is higher that the current stock price). You also don't have to have the funds to exercise the option, you can have a brokerage company exercise the option, then sell the stock at the higher price, with the difference being your profit.
Why is the ask price higher than the stock value?
The ask price is higher than the stock value because it represents the price at which sellers are willing to sell their shares, while the stock value is determined by market factors such as supply and demand.
What of these is most likely to lead to an increase price of a company's stock?
Answer : Its profits increase. Explanation : When a company is more profitable, it's stock is in higher demand, and higher demand means a higher price.
Is it possible to profit from both selling and buying the same stock?
Yes, it is possible to profit from both selling and buying the same stock through a trading strategy called "buying low and selling high." This involves purchasing the stock at a lower price and then selling it at a higher price to make a profit.
Can you explain how a buy limit order works in the stock market?
A buy limit order is an instruction to purchase a stock at a specific price or lower. This order will only be executed if the stock's price reaches the specified limit price or lower. It allows investors to control the price at which they are willing to buy a stock, helping them to potentially get a better deal.
