A stock price is the price per unit of stock at a given point in time. Economists evaluate the direction of the course, based on prices in the past and present, trying to predict it in the future.
What is a promotion
A stock is a security issued by an open or closed type joint stock company . The stock of the company is freely traded on the stock exchange, and the security of the company is only among the shareholders who founded the company. It is issued to raise funds necessary for the maintenance and development of the enterprise. Both private and public organizations can issue shares. They represent the value of all assets available in the company.
The real stock price may be higher than the nominal. Nominal is calculated based on accounting data. The real one includes both the book value of the company and its reputation. Shares are issued in non-documentary form. The shareholder has the right not only to receive a share of income in the form of dividends or part of accounting profit, but also the right to manage the company. He can also expect to receive part of the property in case of liquidation of the enterprise.
Where can I buy stocks
Shares of open joint stock companies can be purchased on the stock exchange. In order to gain access to this market, you need to register on the site of a major Russian bank and download the appropriate program. Through the intermediary of banks, only Russian companies can be acquired.
For those who want to buy shares of foreign companies in order to gain access to foreign markets, you need to register on the FINAM website. Only this organization provides access to foreign exchanges. It should be borne in mind that completely different factors affect the stock price there. This is due to the fact that foreign stock exchanges have their own trading rules and they have completely different requirements for traders and investors, including foreign ones.
Types of shares
There are two types of shares: preferred and ordinary. Privileged companies differ from ordinary ones in that they give the right to receive not only dividends, but also a part of the company's accounting profit. They give an advantage when voting on the board of shareholders and receiving part of the property in case of liquidation of the company. Privilege does not always mean high stock prices. This happens not only with demand, but also with the accounting policies of the enterprise. In some organizations, owners receive a large share in the management of the company, but at the same time dividends on preferred shares turn out to be less than on ordinary ones.
Price classification
These securities are also classified by price. In accordance with the stock price are called:
- Cheap. They are also called penny. These are securities of the most liquid companies. But this does not mean that they will always be so. Here is one of two things: either the organization will go bankrupt or the price will go up.
- Undervalued. Some companies that initially sold penny stocks today are giant corporations, and their securities are the most expensive. The work of an exchange speculator is reduced precisely to identifying such enterprises on the market and purchasing their shares.
- Blue chips. These are shares of the largest and most expensive companies with a high stable exchange rate for several years. For example, companies such as Gazprom, Rosneft, Rostelecom can be noted.
This classification is especially relevant for traders and investors with limited capital. Cheap and undervalued companies are volatile. Their securities can both rise and fall. At the same time, they rarely pay dividends, preferring to invest in expansion, while blue chip holders can count on annual dividends.
Factors Affecting Stock Price
The share at issue has a nominal price. Usually it is calculated based on the book value of the assets of the enterprise and the amount of investment that it can attract. After publication on the stock exchange, other factors influence the price.
An increase in the stock price, as well as a decrease, depends on the demand for them. The following is a list of factors that influence the level of demand and stock prices:
- The financial condition of the company. As the main source of information about this, financial statements are used. The trader checks the liquidity of the company, profitability of production, the ratio of income and expenses, growth dynamics, the likelihood of bankruptcy.
- The state of the economy and the stability of the political system of the state. High inflation, low incomes, revolutions, wars, financial crisis - all this affects the stock price.
- The state of the world economy. The Russian economy is connected with the economies of other countries. Changes in supply and demand for certain goods produced in the Russian Federation affect the stock price of companies that manufacture these goods.
- The number of players on the exchange and the amount of money that circulates on it. The profitability of the organization, the prospects for its existence and development, depend on these factors.
Sudden changes have a strong influence on stock prices. For example, changes in tax legislation, a change in the political regime. Even the discovery of a new field can affect it.
Assessment and Analysis Methods
There are two methods for assessing stock prices - these are technical and fundamental analysis. Each of them requires certain skills and knowledge. In technical analysis, a chart is studied. It is believed that it reflects the dynamics of the stock price and includes all factors affecting the price. The forecast for the future price is based on the history of the security. As tools use various templates, figure building. In the fundamental analysis, not a graph is used as a source of information, but factors that influence or may affect the financial condition of the enterprise.
It includes checking:
- financial reporting indicators;
- statistical data;
- political and economic situation in the country;
- information provided by rating agencies.
When using this method of valuation and analysis for forecasting prices in the future, special programs are used, they perform complex calculations, compare the correspondence of the current market reaction with that which was in the past for a similar event. Fundamental analysis is more complicated than technical analysis , but this does not mean that it is better or worse. Traders and investors in their activities use both methods to get more complete information.
Where can I find quotes
Quotes and stock prices can be found in the trading terminal program window or on the Moscow Exchange website. This information is also published on the FINAM website. You can find out the state of the market by phone by calling your broker. But just remember that such a service in all banks is paid.