Ever wondered what drives stock prices up or down? Let’s break it down.
Stock prices are driven by a company's earnings, profitability, and growth expectations, influencing investor decisions and stock valuation.
Market conditions, trends, and external factors like inflation and economic strength can also affect stock prices, creating short-term movements.
Investor psychology and market sentiment play a big role in stock prices, often leading to irrational movements that don’t align with fundamentals.
Breaking news, whether about a company, industry, or global events, can quickly sway investor sentiment, driving stock prices up or down.
A stock’s liquidity, or how easily it can be bought or sold, impacts its price movements. Highly liquid stocks are more responsive to news and trends.
While short-term factors can drive prices, in the long run, fundamentals like earnings and growth tend to set the true value of a stock.