Questions tagged [stock-market]

Markets in which ownership stakes of firms (e.g. stocks/shares) can be traded.

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0answers
53 views

U.S. stock market 2/5/18

Why did American share prices fall sharply on February 5, 2018? What are the major contributing factors to this?
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83 views

World Stock Markets that went up in 2008

We all know that the US stock market(s) collapsed in price in 2008, see https://en.wikipedia.org/wiki/United_States_bear_market_of_2007%E2%80%9309. I was wondering what countries' stock markets went ...
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119 views

Pro and cons to finding coal

I found some Anthracite coal. I know a coal bed of this quality is worth money? I also know that there is a "no pun intended" carbon foot print if I decide to share my findings to others. Economics ...
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1answer
43 views

How Mark Zuckerburg (or any other company founder) got valued at billions?

I read that Facebook got worth at billions after IPO, but how did this brought money to Mark himself. And did Facebook earned before IPO, or after IPO. I think that after facebook earns from revenue ...
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1answer
99 views

testing the relationship between stock price and macroeconomic variables

I'm in the midst of preparing data to test the relationship between stock index and macroeconomic variables. The variables include m1, cpi, ipi, interest rate, exchange rate. I have some question ...
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54 views

Economic Data - Frequency

I obtained the historical CPI data available in monthly and quarterly format from a data repository. It seems that the Q1, Q2, etc. data are the average of the monthly data. I thought that if I were ...
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2answers
447 views

Fisher Effect - inflation and stock return

This is my understanding: Fisher effect posits that expected nominal returns on any asset would move one-for-one with expected inflation. That is, when expected inflation increase, the nominal return ...
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1answer
101 views

Inflation and stock price

I have indicated my understanding and problem on the attached image below. I'm a bit confused on the impact of inflation on stock price. As increase in inflation would cause nominal interest rate to ...
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1answer
173 views

What lies behind supply and demand model?

This is a very basic question. I can understand that price of goods and stocks change follows the supply and demand law. On the other hand, I find it difficult to understand what happens in the real ...
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Best texts on cash usage and share buybacks in companies

What would be a good reference for how companies utilise their cash to conduct share buybacks. I am trying to understand how share buybacks affect the valuation of a company.
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60 views

Why are share repurchases particularly accretive?

From the "Manual of Ideas"... VALUE CREATION VIA BUYBACKS Share repurchases tend to be particularly accretive in the case of companies generating cash from operations while trading below tangible ...
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In a closed system, what is the relationship, if any, between currency supply and market capitalization?

Assuming: A world in which the market value of publicly traded companies is known Any transaction to buy or sell stock of said companies can only be consummated with a new currency X, which is freely ...
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3answers
15k views

How to convert daily returns to annual returns?

I have a task: to download daily stock quotations, create a portfolio and draw a CML-line. Risk-free rate was given: 6.5% of annual. I decided to convert daily returns to annual returns, using formula ...
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1answer
69 views

How do companies with shareholders close up shop?

How can a company with shareholders stop operations without being acquired or going bankrupt? How is a company with shareholders that is closing up shop able to give shareholders money back for ...
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986 views

How do Sharks make money on Shark Tank through equity alone?

When the Sharks on Shark Tank buy equity in private companies, how do they eventually make money by purchasing only equity? For example, if the company makes a lot of money for a few years but then ...
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1answer
90 views

How can CVS which has about 3 billion in cash on hand buy Aetna for 69 billion?

How will CVS be able to buy Aetna for 69 billion if CVS only has 3 billion in cash without borrowing a large amount of money? I understand that a company can trade for a multiple larger than 1 of ...
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3answers
247 views

Aside from buying IPOs, what exactly is the point of shareholders?

The more I look at the shareholder system in modern capitalism, the more it starts to appear as nothing more then an otherwise meaningless system that allows rich people to profit off others work ...
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69 views

Monthly savings plans

Monthly savings plans in stocks or funds are typical investments for many people. On aggregate, these plans generate a large demand on the underlying assets, often around the end/beginning of a month. ...
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77 views

How to know when hype is reason of a stock prices increase?

I was going to ask if there are any industries or companies that would be insulated from experiencing price changes from hype but I'm assuming it always plays a role. So, the question then turns to ...
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6k views

Does the US stock market tend to rise after natural disasters?

It seems counter intuitive that markets would rise after a huge disaster that probably affects multiple industries like oil or produce. For example, can someone explain why the US markets actually ...
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What is a stockholder class action for?

Sometimes, when a public company allegedly does something wrong/illegal/etc, the investors of the company organise a class action suit against the company, such as the Commonwealth Bank of Australia (...
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1answer
1k views

1929 stock market crash and unemployment rate

Thomas Sowell has repeatedly made the case that government intervention is largely responsible for the Great Depression. For example, he notes what happened with the unemployment rate in the months ...
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1answer
74 views

Clarifying the meaning of market capitalization

I'm new to this kind of topic and I'm trying to get a deeper understand. I read that "the shares' price times the number of shares outstanding is the value of a company (=market capitalization)". ...
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Is falling inflation in India one of the reasons for the Nifty crossing the 10,000 points mark?

Recently the Nifty crossed the 10,000 mark for the first time. At the same time inflation in India is falling. My question is whether the fall in inflation in India one of the reasons for the Indian ...
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3answers
361 views

Does my research prove market inefficiency?

The long story short, I have developed an index based on a certain distribution. Then I aligned NYSE stocks according to this index i.e. the stocks with the best fit are first and the worst are last. ...
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4k views

Can the stock market show indefinite exponential growth?

In a comments on a question on money.SE, the following dialog took place: Eventually there will not be enough matter to represent all the money, so we know for certain that the answer is "No" for a ...
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1answer
902 views

S&P 500 total return excel sheet

Where can I find an excel sheet with total return (that is, with dividend reinvestment) of the S&P 500? I have only found an online "calculator" (not an excel sheet), or an excel sheet with ...
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42 views

How long do stock markets usually take to process complex new public information?

Here is a question that I've been thinking about for a while: Theoretically, assuming investors are rational, a stock's price will be equal to its its intrinsic value (present value of discounted ...
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Model for the psychology of trading?

In some cases I see otherwise stable stocks or commodities having wild swings in price on exchanges. Even though the underlying company or commodity is going along normally and there is no news that ...
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142 views

Where is there more money: Bank Accounts or Brokerage Accounts?

There is a significant amount of money in the stock market in US companies. For example, look at the largest US company by market cap - Apple. It is currently worth over 800 billion US dollars. I've ...
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1answer
57 views

Collar strategy for options trading [closed]

I am new to investing on the market so I am doing some research and studying. From what I can tell, the purpose of a collar strategy for options trading is to protect your gains you've made on the ...
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3k views

If there was world war 3, which stocks should I short? [closed]

With the Trump administration, Turkish dictatorship, North Korean nuclear weapons, and general tension around the world, we might think that there is a likelihood of something like a world war ...
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250 views

Is belief in future dividends the only long term value of stock?

Are future dividends the primary value backing that a stock price will rise? (Let's assume that purchase by a competitor is an unlikely event and discount the value this might have). It seems to me ...
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2answers
101 views

Can the major indice of an exporting nation decrease at the same time the currency devalues?

In the UK, the FTSE100 is achieving record highs at the same time the currency (GBP) is depreciating rapidly. The media often correlate the two events by reporting that since the indice is made of ...
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51 views

Find high resolution market data for a single ticker?

I'm doing my dissertation at the moment and for it, I need high-resolution market data. The only problem is I'm a student and haven't got much money. A lot of sites I have seen want monthly ...
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I do not quite get a phrase that I read in the Financial Times today.

"a share that has fallen by 95 per cent has fallen by half since it has fallen by 90 per cent" Can you explain the logic behind that?
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How can trailing and forward P/E ratio of main stock markets show such huge difference

I've recently found this web page, listing the average P/E Ratios of main stock markets: http://www.zutosmoney.com/ Here I reproduce just a small extract: INDEX - Country - Trailing PER - Forward ...
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Are stock trade commissions evidence of anti-competitive practice?

A typical commission on a typical stock trade these days is $8. I don't understood how it can cost this much. It looks like the entire process is happening in software, electronically, and so the ...
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306 views

Do stock markets price in existential risk (i.e. global nuclear war)?

Question Moved from Money StackExchange: https://money.stackexchange.com/questions/74002/do-stock-markets-price-in-existential-risk-i-e-global-nuclear-war Q: Do stock markets price in existential ...
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Do the stock performances of various companies have a measurable correlation with exchange rate?

For example if the values of big companies in a country decrease, will the value of that country's currency measurably decrease?
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95 views

Using the Dividend Discount Model when no current dividend exists?

Say a company is doing an IPO and we expect them to start paying dividends in 5 years? I understand how we could use the Dividend Discount Model to predict their stock price 4 years from the IPO. But ...
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5k views

What are examples of inversely (negatively) correlated stock prices in economics?

I’m looking for example of two goods/wealth that demonstrate inverse/negative correlation. For example if price of A rises then price of ...
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1answer
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Does constant market cap imply reversion to the mean

If the market cap of a market is constant, do stock prices necessarily follow the principle of reversion to the mean? How would one prove this? (I'm pretty sure this is trivial, but I don't know how ...
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38 views

Online stock portfolio selection algorithms applicable to forex markets?

Are stock portfolio selection algorithms, like the universal portfolio algorithm, applicable to forex markets, treating each currency like a stock?
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37 views

When should a company's revenue and share price grow faster or slower than the economy?

I was listening to a famous investor discuss an investment of his in an interview. He had bought shares in a bank that was quite successful, though it was a small bank. The bank is based in a highly ...
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68 views

How to understand share value vs real worth of the company

When read in the news articles for stock market price, I learned that the share value of a company changes in a year. My question is does the share value really reflect if the company is doing good ...
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4k views

When a stock market crashes, how does money just disappear?

I looked it up online (here), but I find it hard to believe that money literally "disappears". For example, if I buy 10 stocks of a toaster company for \$100 per share, and then the stock value drops ...
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4answers
1k views

Why do people trade derivatives?

If I have information that an asset will increase or decrease in value, I can profit on that information by buying or shorting the asset. Why, then, would anyone trade derivatives when they can just ...
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77 views

Buying stocks in company merging/acquisitions

Does an acquiring company have to buy all the stocks of a target company to acquire/merge with it? If so, why? I thought stocks give voting rights and dividends, but not direct control of company ...
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1answer
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Is it fair to compare 1950 US economy to 2016 US economy?

In the last 2 days, bond market has declined a bit. All major news outlets published articles like these: Can We Ignore the Alarm Bells the Bond Market Is Ringing? Such an event in bond market ...