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Why investors are willing to pay an increasing price for a company?
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What does a company's stock price say about that company?
A company's stock price can show the following:The confidence and trust investors have on this companyThe profit making history of the companyThe probabilities of reaping capital appreciation on this stocketcRoughly: The higher a stocks price in the market when compared to its face value, the greater investors confidence in it.
Why do stocks rise and fall?
Stock prices rise and fall depending on a company's profits. If a company's profits keep growing, its stock price will grow as well. If a company's profits fall, the price of the stocks will fall as well. The price of the stock actually is dependent on investors confidence in the company to continue to grow and show a profit. For instance, a company's profits could be stable or even increasing, but if a rumor that it is about to experience hard times is believed, it's stock price could fall. Answers with links in them are not permitted.
Market price of a share of stock is determined how?
Market price is the price at which a buyer is willing to buy and a seller is willing to sell.
Can a monopoly charge any price it wants for a good?
Any company can charge any price it wants for a good. The real question is whether people will be willing to pay that price. Monopolies are not immune to the laws of supply and demand.
Why is gold price increasing?
Gold is increasing in price because there is now significantly less of it available to mine and also the cost to mine metals has now increased. Most mining companies can produce an ounce of gold for $500 (USD) or less. It's not a lack of supply that's causing the price to rise. Investors are bidding up the price of gold because currencies are being devalued. Governments around the world are printing more money to service their debt. That makes their currencies less valuable, relative to tangible commodities. Investors expect this trend to continue, so they are investing in gold and other commodities, rather than bonds, which will fall in value as the currencies in which they are denominated are debased further.
How a company determines the price of its share?
If a company is publicly traded, the company itself does NOT decide the price of its shares, the market does. A share of stock trades for what an investor is willing to pay for it. Thus, if many investors are interested in buying a stock, its share price will rise. If there isn't much interest, its price will fall. Basic supply and demand.
What does a company's stock price say about that company?
A company's stock price can show the following:The confidence and trust investors have on this companyThe profit making history of the companyThe probabilities of reaping capital appreciation on this stocketcRoughly: The higher a stocks price in the market when compared to its face value, the greater investors confidence in it.
Can a firm increase its stock price by increasing dividends?
Probably not. Investors like companies to spend their money logically. If the company decides to increase its dividend for no other reason than to try to get the stock price up, it will probably go down.If a company wants to increase its stock price by spending money, the best way is to invest in technology of some sort. Investors know technology investments will eventually make the company more money, which will trickle down to the dividend at some point in time.
If most investors expect the same cash flows from companies A and B but are more confident that A's cah flows will be closer to their expected value WHICH company should have the higher stock price?
Investors in the company will drive the stock price up for Company A if they are more confident that Company A's cash flow will be closer to their expected value. Company A's stock price will be higher than Company B.
What is the price of a share in a mutual fund?
The price investors pay for a share of the company is based primarily on the market value of the securities in the portfolio
Why do stocks rise and fall?
Stock prices rise and fall depending on a company's profits. If a company's profits keep growing, its stock price will grow as well. If a company's profits fall, the price of the stocks will fall as well. The price of the stock actually is dependent on investors confidence in the company to continue to grow and show a profit. For instance, a company's profits could be stable or even increasing, but if a rumor that it is about to experience hard times is believed, it's stock price could fall. Answers with links in them are not permitted.
Why do stock prices go up and down?
Stock prices go up and down based on the changes in investors' demand for a given corporation's stock. That demand is determined by investors' and potential investors' expectations regarding the company's future profits. If potential investors expect that a corporation will make high enough profits in the future, and they want to share in those profits and are willing to pay the current market price for the stock, they will buy stock in the company. But since there are only a fixed number of shares available for sale at any given time, as more and more new investors want to acquire stock in the same company, its price will be bid up until it gets so expensive that the expected future return no longer justifies the investment required to acquire the stock.Similarly, if stockholders get information that leads them to expect that the corporation might not do as well as they originally thought (or it looks as if having stock in another company will yield a better return for them), they will try to sell their shares at the market price. But since new investors will not be willing to pay high prices for stock when there is a big risk that the company might perform poorly, and a lot of current stockholders are trying to sell their shares at the same time, the demand for the stock on the part of new investors will be low, and its price will go down.
What are the advantages of organizing businesses as corporations?
Investors can sell their shares whenever they want for the best price they can get. Investors only risk losing the money they themselves put into a company.
How individual investors are affected by institutional investors?
Institutional investors have more money and access to company managements. So they can buy early and sell early. Individual investors usually buy only after the institutions have jacked up the price. Then they are left holding high priced stocks when the institutions move out.
What does it mean for investors if senior management or directors trade company shares actively?
The share price is low or the prices are going to go up
What is book-built issue in issue of shares?
Bookbuilding method: It is the most common method used. Here the companies decide on the price band. The lowest price is reffered to as floor and highest price is reffered as cap. The investors then have the freedom to bid for the number of shares and the price they are willing to pay for it. The actual price is then discovered based on the bids.
How did the east india company come into power?
east India company had come into exitance by increasing tax,selling machine made good with rates,increasing general price levels,economic exploitation.EAST INDIA COMPANY captured power in 1757but established in1857 revolt.
