Why Do Stocks Go Up & Down?

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Stock prices go up and down based on the trading volume and events that occur in the company. Research whether a company's stocks will go up or down based on the performance of the company with help from an investment manager in this free video on investing.

Part of the Video Series: Stocks & Mutual Fund Investments
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Video Transcript

Alright so why do stock prices go up and down? The prices of a stock will go up and down based on a number of different things. Usually it can be trading volume, if the volume of trading is up if lots of people are buying, that will bring the price up because it seems as a desirable share. If it's going down because of high volume of selling, then the price will come down as well being seen as something that's being devalued on the market. The other thing that can bring up a price of the stock is good news. Maybe they found something, the developed something, they have a new product line or they've changed management, they've done something differently that seems as positive or negative in the market and that will bring the price up or down. And really it's something that's going to be happening everyday, between days and also intra day. So the price goes up and down not for just sort of a whimsical reason, there is a reason behind it always and it may just be something where a large institution is buying a lot of shares and bringing the price up and vice versa, could be selling them. But the prices do go up and down for a rational reason and if you do your research you can find out why.

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