Where Do Stock Prices Come From? | Comment Below

Where do costs originate from? That's the concern we'll address in this most current episode of Comment Listed below, a series that responds to inquiries from our audience. We'll check out how a 's price is set initially, why it alters, and more.

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16 Comments

  1. Since there’s a buyer of x # of stock and a seller of the same X amount, HOW CAN YOU SAY THERE ARE MORE OF BUYERS OR MORE OF SELLERS?? Based on what you said:There’s an equal number of buyers and sellers.i think it’s more of who initiated the buy or sell whether an institution or an individual I believe?

    1. Good question. Just an assumption. It could be that the stocks sold, first end up in a pool of stocks held by the brokerage firm, then waiting for a buyer. So more stocks could be sold than bought. It will depend on the demand. If there are more buyers than stocks available in the pool, then the stock price just will go up.

  2. I have a more personal question but I think it can apply to many others. What are the requirements to increase my options trading level so I’m able to use more option trading strategies?

  3. Question for future Comment Below video: When a stock price moves up (or down) over a day, what tools can investors use to guage how long this trend will continue? Thank you. Regards, KM

  4. Can you do a video about ETFs? Questions are so you need a different account due to taxes, what type of taxes, how to pay the fund manager, is there a minimum shares you need to buy and as I said.. Can you do a video on ETFs? This is a great video to explain stocks.

  5. Ken Griffin from Citadel, a market maker, said and I’m paraphrasing, the market maker decides how much a share in any given company should cost. Fair and free market????

  6. How are daily opening stock prices set? What are “Market Makers” and what role do they play in stock prices.

    1. Market makers constantly have both a bid and an ask open for assets they track, in order to provide liquidity, so traders can always buy or sell. Without them, the bid/ask spread can be extremely wide, or the order-book can even be totally empty such that even market orders fail. They don’t actually want to be very long or short, so they will constantly move their prices to avoid that. They make money by warehousing assets for very short periods of time and then selling them off for slightly more on average, and/or they may be paid by a company to make a market in their stock/ETF.

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