Stocks, shares, etc are considered as some of the important terminologies of share market that entail an inseparable feature of risk. The rise and fall in their prices affect the growth of various industries that eventually affects the country's economy growth rate. In a simple term, stock, also referred as financial instrument, can be defined as smallest unit of ownership in any company i.e. if you are having a share of company's stock, then you are considered as part owner of the company and can enjoy certain sets of rights and privileges. Basically, common and preferred are two kinds of stocks available in the share market. Former enjoys more liquidity and many other benefits as compared to latter. The one who owns common ones has right of voting and right to share in company's dividends, whereas, owners of preferred stock can only exercise right to dividends. Like share market, these financial instruments are also volatile. Depending upon the market conditions, the price can surge or fall. Some of the main reasons which play a crucial role in deciding their prices are assorted below: Situation when prices may go up â€If company entered in any kind of big contract, then stock prices greatly affected. â€If company has declared global expansion plans or any sort of positive news. â€If the industry is being labeled as hot by industry experts. When prices may go down â€Myriad people start selling the shares due to decline in sales and profit of the company. â€Any kind of disputes between the top executives may result in depicting the unfavorable goodwill of the company. â€If prices of other companies, in the same industry, is going down. Therefore, it can be said that there are innumerable reasons which can affect the price of financial instruments significantly. Hence, it is advised to avail professional guidance or financial experts guidance before entering in the share market. Nowadays, numerous web portals like Moneycontrol.com, etc. are providing online guidance to novice as well as experienced investors regarding recent happenings of the share market and which time is best to sell or buy the stock of any particular company. Hence, avail the online guidance of such portals if you want to accumulate good capital for rainy days.
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