2007-02-15 05:17:07 · 6 answers · asked by Utopia 4 in Business & Finance ➔ Investing
Stocks go up because more people want to BUY the stock at the current price than would like to SELL. Therefre causing the price to RISE until BUYERS and SELLERS balance out.
The market is purely supply and demand driven. If there are less people willing to BUY at the current price than want to SELL, then the opposite happens. The price goes down.
There are many warning signs for selling. Changes in the company (lost customer, management changes, litigation, etc.) changes in the performance (downward shifts sales or earnings trends), competitor changes (competitor capturing market), shifts in the industry (product becoming obsolete) Etc Etc Etc.
Another signal can be when the valuation gets too crazy (1999-2000)!
2007-02-15 05:39:34 · answer #1 · answered by random_market_investor 2 · 0⤊ 0⤋
Stocks generally go up and down because of a lot of factors. However, the best time to sell is when everyone you talk with thinks it is easy to make money in the stock market. Just think back a few years before the dot.com implosion. Everyone you talked with was a wall street genius and had 40% returns per year. When this happens again it will be time to sell. It is hard to walk away when it seems like everyone you talk with is making easy money, but not doing so could cost you a fortune.
2007-02-15 13:43:22 · answer #2 · answered by Contrarian 3 · 0⤊ 0⤋
Stocks go up because there are more people, who want to the shares at the current price than to sell. Similarly in case of stocks down.
2007-02-19 04:44:26 · answer #3 · answered by sindhukannankattil 2 · 0⤊ 0⤋
the term "I wouldn't put much stock in it" is indicative of what stock is. It's a "Belief" or "faith" in a company. Stocks go up and down because of certian actions surrounding the company. For instance:
Kareem Jabaar was diagnosed with AIDS, Trojan stock triples in value over the next quarter.
Bush announces we are "Officially at war" with Iraq, halloburten(SP?) stock sky rockets over the next fiscal year.
Keeping up with current events is the best way to feel the market. For instance, I wouldn't be putting much stock in mortgage companies right now but in 3-6 months when the ARM wave hits (600 million people's rates will start adjusting in the next 3-6 months) It will be prime market to buy stock in New Century Mortgage. Take my word for it!
2007-02-15 13:27:18 · answer #4 · answered by Anonymous · 0⤊ 0⤋
If people are buying then it goes up.
If people are selling then it goes down.
I email the warning signs to you email.
Here is an example:
SELL VG
Top 4 Answerer.
2007-02-16 01:24:09 · answer #5 · answered by Anonymous · 0⤊ 1⤋
The current price of anything means there are people who believe it can still go up, otherwise the price would be down already.
2007-02-15 13:24:59 · answer #6 · answered by Gustav 5 · 0⤊ 0⤋