stock market is a operator driven market or fundamental driven market?

Answer 1

If i understand your question corrctly, it is operator driven. Many like to claim that it is fundamentals driven, but the proof that it is operator driven is the internet bubble.

The run-up if stock in the late 90's had no basis in fundamentals (underlying data about the company, including earnings, cash etc.).

As much as people like to invest based on fundamentals, humans by nature are emotional beings. As a result, these emotions will cause us to react in ways that are not always best. We see a stock go up and feel that we have to buy so that we dont miss out and conversly, fear drives us to sell stocks that are fundamentaly sound when they correct.

The result is that stocks are almost never priced at the point that fundamentals say they should be at. We buy and sell stocks baed on greed and fear and try to use fundamentals to temper and justify those feelings.

So while fundamentals do play an important role and there are plenty of traders who do trade solely based on those fundamentals, the majority of traders trade on feelings and emotions and therefore distort the price in both directions.

Answer 2

Not really. In the long term, most share prices tend to follow fundamentals, but even over periods of five years or more they can diverge significantly. This isn't, however, because someone is manipulating the stocks; it's a matter of the difficulty of figuring out precisely what a stock is worth, of people "looking over each others' shoulder" to see what they think the right value is, and eventually the way emotion and behavior of large groups of people play into all of that.

For biggish stocks traded on major exchanges, prices in the short term are driven by emotion and crowd psychology, and in the long term are driven by fundamentals.

Answer 3

I suppose if public is plus it goes down and if public is minus it goes up. It only goes against what majority thinks.

Answer 4

There is some useful advice here.