Stock entry: stock price

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					Stock entry: stock price
First, the value of the stock

In essence, the stock is only a certificate, its role is used to prove
property rights holders, rather than general merchandise includes use
of the same value, so the stock did not value their own, can not have
prices. But after holding the stock, shareholders will not only attend
the general meeting of the company's shares to influence business
decisions, and also to enjoy the dividends and dividend rights, access
to appropriate economic benefits, so the stock is a virtual capital,
as a special commodity into the market negotiable. The value of the
stock is in the form of monetary profit as a means to measure the
value of the stock. The so-called profit means, that by virtue of the
stock, the holder can obtain economic benefits. Interests of the
larger, the higher the value of the stock.
The value of the stock, there are face value, net liquidation value,
market value and intrinsic value of five.
1. Shares of face value. Par value shares, the shares are shares
issued by the company indicated on the face value, it per A share as a
unit, whose role is to show that each one contained in the amount of
capital stock. The nominal value of shares of stock are generally
printed on the front and basically are integers, such as the hundred
dollars, ten-dollar, and then one element and so on. China's Shanghai
and Shenzhen Stock Exchange in the shares in circulation, and its face
value are unified as One million, one dollar per share. The initial
face value of the stock objective is to ensure equity holders is the
time to recover the divestment of the indicated nominal assets. With
the development of the stock, buy stocks will no longer Divestment, so
the role of par value is one that shares of stock subscription in the
share of investment, as recognized under the rights of shareholders.
If a listed company's total share capital of ten million yuan, holding
an equity stake in the company, says the share is one ten-millionth.
The second effect is that when the first issue of shares will be
issued shares of face value as a basis for pricing.
In general, the issue price of the stock will be higher than the face
value of all. Flow into the secondary market when the stock after the
price of the stock's par value and stock separation, and with each
other and there is no direct link, investors how much love it fried,
it will be high, as in previous years Some of the Shanghai stock
market share prices had reached 80 yuan, but its also just one dollar
face value.
2. The net value of the stock. The net value of the stock, also known
as book value, also known as net assets per share, referring to the
method of accounting per share calculated from the net asset value
included. The calculation method is to add all kinds of company's
registered capital fund, accumulated surplus, which is commonly
referred to as equity, will be divided by the total net asset value
per share equity is. The carrying value of the stock shares after the
company removed the actual possessions of all the debt is the net
assets of joint-stock companies.
Accounting book value is calculated as the result, the number of
higher degree of accuracy, reliability strong, so it is the stock of
listed companies for investors to assess and analyze the important
basis for operating strength. Shares of the company's book value, then
the real property owned by the shareholders of the more; the other
hand, stocks with low book value, shareholder-owned property for less.
Although the book value of the stock is an accounting concept, but it
investment analysis for investors with large reference, it is also
produced directly from the stock price, because the stock price more
close to the net assets per share, the more close to the price of the
stock the book value of the stock.
In the stock market, investors concerned about the joint-stock
companies in addition to the operations and profitability, the need to
pay special attention to the stock's net asset levels. Higher levels
of net assets, the company owned its own capital to the greater
ability to resist various risks will be.
3. The liquidation value of the stock. The liquidation value of the
stock, shares of the company is bankrupt or be liquidated after the
collapse of the stock represents a share when the actual value. In
theory, stock liquidation value per share and stock book value should
be consistent, but the company in bankruptcy liquidation, the value of
their property based on actual sales price data, and during disposal
of property, its sale prices are lower than the actual value.
Therefore, the liquidation value of the stock with the stock's value
is not consistent and generally have less than the net. The
liquidation value of the stock shares of the company only in
bankruptcy or for other reasons due to the loss of legal personality
to conduct the liquidation only to be the basis for determining the
stock price, the stock issued and outstanding process is meaningless.
4. Stock market value. Stock market value, also known as the stock
market, refers to the process of stock trading in the trading price
reached by both sides. Direct reflection of the market value of the
stock market, stock quotes, stock trading is the basis for
shareholders. Due to many factors, the market value of the stock in
the regular changes. Stock market value is closely linked with the
stock price, stock price is the concentrated expression of the value
of the stock market, the former occurrence of subsequent changes in
those corresponding fluctuations. In the stock market, investors are
based on the stock market value (stock market price) to analyze and
judge the level of change and determine stock prices, so-called stock
price is the market value of the stock.
5. The intrinsic value of the stock. The intrinsic value of the stock
is at some point the true value of the stock, it is the investment
value of the stock. Calculate the intrinsic value of the stock
discounted required,
Life of the listed companies, profit after tax per share, the average
investment rate of return and the community are all unknowns, so
difficult to calculate the stock's intrinsic value, in practice,
usually take forecasts.

Second, the operating results and stock price

Stocks, although there are a variety of subjects, but in general,
results of operations are generally fried or results of operations
related to the subject matter. So in the stock market, stock price and
operating performance of listed companies was a positive correlation
between better performance, higher stock prices; poor performance,
stock prices will correspondingly lower. But this is not absolute,
some of the operating results of the stock so a few cents per share on
its price performance ratio several times better than its stock even
higher, which in the stock market is very normal.
Because stock prices are determined by the competition, as long as
investors are willing to have sufficient funds, and law-abiding in the
stock trading process, the final transaction price for a party to the
decision by the highest bidder.
In theory, results of operations of the stock prices are usually
expressed in two formulas, one is a static formula price, and the
other is a dynamic formula, the net state is calculated as follows:
Where P is the stock price, L is the per share after-tax profits, i is
for other investments, investors can get the average profit rate of
investment, savings rate tends to be used instead, because the savings
in the current shareholders of the most common and can The most
convenient way to invest.
The significance of this formula is that when investors engage in
other investment income per dollar i get, if the stocks in the
investment income to obtain L, shareholders must pay the amount of
funds to the P, this time, the proceeds to invest in stocks and other
investment are equal.
Such as the one-year deposit rate to 10.98%, is a stock's after-tax
profit of 0.66 yuan per share, according to the above formula, the
share price to 6.01 yuan. At this point, will be 6.01 yuan to invest
in stocks or to deposit banks, the investment income are the same.
In the above formula, the stock price and results of operations
proportional to the average profit margin is inversely proportional to
other investments. If the operating performance of listed companies to
raise or lower interest rates of savings, will result in stock prices
are rising. As May 1996, the Chinese People's Savings Bank lowered
interest rates twice to lead the Shanghai stock market stock prices
more than doubled.
However, the formula used to calculate the stock price is not
accurate. In fact the share price on the stock market is not thus
determined, the factors that affect stock price changes are not only
the operating results and the average profit rate of investment both.
In addition, the company's operating results will be listed as the
business environment and product market competition and change. The
above example, if the next year, the operating results of listed
companies dropped to 0.55 yuan per share, calculated here, and its
stock price will fall to 5 yuan more. If the shareholders during the
year to predict the performance of listed companies will reduce next
year, you will not use the price of 6.01 yuan per share to buy the
stock, but only with the price of 5 yuan to buy more stock.
Stock price above This calculation is a net state law, it assumes that
the selected parameters, such as after-tax profits and stock savings
rate is static, the result will certainly be a considerable error.
Although the stock price is difficult to use a precise formula that,
but one thing, it is always and performance of listed companies that
profit after tax increase or a positive correlation between the two.
Greater after-tax profit, shareholders of investment income will be
high and, correspondingly, the higher the price of the stock.

Third, the average profit margin and stock price

The average profit margin is about an objective law of capital flows,
the effect that:
When the two departments there are differences between the profit rate
of investment, the funds will be from low-margin sector departments to
the flow of high profit margins, profit margins until the two almost
equal investment in the sector. Popular with the words to express an
average profit margin rule is: Going with the flow, capital to go to a
place of high profit margins.
Stock price is directly affected by the situation in the supply of
funds, when the funds into the stock market increases, the price of
the stock price will go up, such as the good news is introduced, to
have access to external capital markets, causing stock prices.
The end of July 1994 announced the "three policies" and May
17, 1995 announced the news to suspend bond futures have lured a lot
of money into the market, to varying degrees, led to the stock
market's surge. Withdrawal of funds out when the stock market, the
stock price will decline.
When a field of investment profit rate changes, stock market and
investment between the field margins will produce a potential
difference. Law based on the average profit rate, the stock market and
the investment capital flows occur between, and the results will cause
liquidity of stock price changes.
Investors to invest in the stock market, the expectation is to reap
excessive profits, which receive more than the social average profit
level of investment income. And all the investors in the stock market
operations (buying and selling) are the concentrated expression of the
average profit margin rule. Taken together, the average profit margin
on the stock price of regular has the following four aspects.

1, to the price positioning
Most of the investors to buy shares of the motivation is that the
stock will rise, and rise within a year will certainly be higher than
they can get involved in the investment field, otherwise, investors
will be funding to other areas of high profit margins. The investors
will be pouring money into the stock market results, driving shares
will be gradually increased flooding, resulting in a decline in stock
returns. When the results of the campaign funds to other areas of the
stock returns is close to the average level, investors were buying
stocks and other investment income on the basic equal, then capital
flows will tend to be flat, the stock will remain at a considerable
level, neither up nor down. Therefore, the average profit margin rules
have to locate the role of stock prices.
For the general public, its financial strength smaller, but also take
into account the work, its main investment channels at this stage,
that is, bank savings, purchase of bonds and stock investments. Since
almost no risk at all bank savings and does not spend much time and
effort, so the general public savings bank of choice for investment.
To make equity investments, interest rates generally will be the
expected return as equities. When the proceeds to invest in the stock
is greater than the bank deposit interest rates, people will choose
stocks; the other hand, when the bank deposit interest rates higher
than the stock rate of return on investment, people will choose to
save. So, when a stock market investors are more rational and mature,
the stock market and investment income will be where basically the
savings rate equal to one-year, and thus its stock price will
stabilize at a level corresponding to this.
The measure of a stock market investment profit rate of return is
usually the inverse of the stock price - the stock market average
price-earnings ratio, profit margin and investment in the stock market
average price-earnings ratio is the inverse relationship between, when
the stock returns and bank savings rate equal to one-year When will
Stock market average price-earnings ratio ¡Á year bank deposit rate = 1
When the bank's deposit rate is determined, the stock market's
price-earnings ratio will stabilize at a level corresponding to the
stock price also will be determined.
Stock market average price-earnings ratio = 1 / one-year bank deposit

2, causing stock Change
Law based on the average profit margin, when the stock market
investment in the field margins around the changes, funds are always
low profit margin from the sector to the mobile sector profit margins,
resulting in the transfer of funds. At this stage, the main areas of
capital stock savings banks, bond market, futures market, real estate,
etc. In addition, trade, industrial investment and collection industry
has some of the stock market.
Bank savings and bonds: When adjusting the interest rate savings and
bonds, the stock market and the savings or the proceeds of the bond
market will break the balance of funds will be transferred to chase
the higher profits. Specific savings or bonds is when interest rates
rise, the market value of investments will be reduced accordingly,
investors will sell stocks or funds to invest in savings bonds,
causing stock prices; the other hand, when the savings or bonds when
the interest rate cut , people will draw from the savings funds or the
bond market into the stock market, eventually leading to the rise in
stock prices.
Owned by residents in China's financial assets, accounting for more
than 90% for savings deposits, followed by bonds, these two areas
absorb the maximum amount of money. Therefore, interest rates or bond
interest rate adjustment of stock prices is the greatest. Such as the
People's Bank of China in 1996 has twice lowered interest rates on
deposits residents, Shanghai and Shenzhen stock markets has led to a
surge in stock prices.
Futures: the futures with high risk and high-yield characteristics, so
China's futures market has absorbed a lot of hot money, and the
securities business departments of many of the futures business agent,
funds transfer between the stock market and futures is extremely
When the futures market when the hot market, it is often the funds
will be attracted to the stock market, causing the stock market
downturn and the stock price down; and when the futures market when
the market was light, the stock of money is more filling, the stock is
relatively strong. Such as the May 18, 1995 China Securities
Regulatory Commission announced the suspension of all Treasury futures
business, a lot of money quickly into the stock market, eventually
leading to the stock market's surge, the Shanghai and Shenzhen stock
markets rose on this day were 31% and 23.5% .
In addition, when the stock market around the real estate, collections
industry, trade and relatively prosperous areas such as industrial
investment, due to the lure of high profit margins, these areas will
attract capital from the stock market. If China's Wenzhou, specializes
in business due to local residents and industrial investment, and in
these industries can achieve higher profit margins, even in the hot
market when compared to other cities, its securities trading business
is also more quiet.
Accordingly, the transfer of funds within the stock market can also
lead to ups and downs of stock prices. When investors think a stock
value of investment, the substantial influx of capital will be the
stock, thus contributing to the rise in the price; and when the
prospect of a stock is poor, investors will sell out the stocks from
which funds resulting in the stock prices. If the interim report
published in 1996, the performance of a stock loss of 0.70 yuan per
share, also above. The day of the disclosure, the price dropped about
3, leading to the return of stock
When a stock's share price rose too fast, the stock's spread income
will be significantly more than its land area. In the temptation of
high profits, the influx of external funds will have to further raise
the stock price index rising drive. The inertia of the influx of
funds, stock index tends to rise to a relatively high point. At this
point, the funds into the stock market has been a relative surplus of
high price-earnings ratio, the high price of capital is no longer
attractive. Relative to the surrounding investment markets, the stock
market significantly lower rate of return on investment. This is the
average profit margin of the role of law in the stock market in turn
will lead to other investment funds from the stock market liquidity,
some of the more sensible will be the first to withdraw funds for
investors, stock prices began to fall, causing even the sales
response, eventually leading to stock market crash, the stock index
and the surrounding area back to a suitable level of investment profit
margin, which is the stock market soared after the collapse of the
reason why there must be. Conversely, when the stock market crash and
the stock price appears too low, the share price gains rate, lower
price-earnings ratio, the investment value of stocks will be higher
than other investment market. At this point, the average rate of
profit under the effect of capital market to the stock market will
shift from the periphery, causing the stock price rise.
Tokyo, Japan, the late '80s stock market, and its rate of increase
more than 30% for several years, the stock market spread benefits far
higher than other industries, so the funds into the stock market like
a snowball-like snowball, the Nikkei index from 1986 years, 13,000
more into the 1989 peak of 39,000 points, up to 100 times its
earnings, resulting in a serious bubble economy. In subsequent years,
the Tokyo stock market slump and a dedication to enter the difficult
phase of adjustment. In 1995, the Nikkei had fallen to 14,000 points,
the highest point is only 38%, almost from the end back to the
starting point. By now, the Nikkei is still 2
Wandering around. Similarly, the Hong Kong stock market gains in 1993
had more than 100%, in early 1994 reached a peak of more than 12,000
points, but today's Hang Seng index is still hovering at 12,000
points. In China, the course of 5 years the stock market are basically
the same, Shanghai and Shenzhen stock markets, respectively, from
December 1990 and April 1991 began to count points, due to stock
market wealth effect, our residents within the stock market in just
two years devoted a lot of money, which led to soaring stock prices.
To the end of 1992, the Shanghai Index and Shenzhen index rose from
the 100 780 and 241, respectively, points, the average annual increase
of 179%, respectively, and 68% in the first half of 1993 in Shanghai
and Shenzhen stock market index reached a record the highest level of
1558 points and 368 points, the stock market will enter an adjustment
phase, four years later, while the Shenzhen composite index to new
high, but the Shanghai Composite Index still hovering below the 1558

Fourth, the net assets and share price

The net assets of a listed stock company stock for each service
included in the number of real assets, also known as book value or net
equity, referring to the accounting method used to calculate the stock
value of the assets included. It marked the listed company's economic
strength, because any business is its business based on the number of
net assets. If too much debt a company has net assets of less
effective, which means that the vast majority of its operating results
will be used to repay; such as the phenomenon of too much debt
insolvency occurs, companies will be faced with the risk of bankruptcy
Equity investment and bank savings vary. Because the savings interest
rate is fixed in advance, so the savings is proportional to the amount
of income and savings, the deposit was more, the greater the profit.
The stock return on investment only the amount of shares held directly
proportional to input does not mean much on the big gains, even if the
investors put the same amount of money, but because of varying the
number of shares purchased, the investment income is likely to be
different large.
Because stock returns depends on the number of shares rather than
stock prices, and the per share net asset included in the management
of listed companies determine the strength, determine the operating
performance of listed companies, each share of net assets is included
on the decisive influence stock prices.
Stock prices and the relationship between net assets per share and
there is no fixed formula.
Because in addition to net assets, business management, technology and
equipment, market share and the external image of the enterprise, and
so will the ultimate impact on operational effectiveness, and net
assets of the impact on stock prices mainly from the average rate of
profit law effect.
Has been expressed in the previous section, the role of law because
the average profit margin, return on net assets of enterprises will be
around an average level of volatility. For listed companies, because
after a more rigorous review, and more flexible operation mechanism
and management level is higher than the average company, so its
profitability is higher than ordinary business in general.
If recent years, the average profit margin of the business about 10%,
while the average listed company in 1993, 16% of net assets, 13.5% in
1994, macroeconomic tightening in 1995, industrial enterprises The
lower operating income, but the listed company's net assets yield rate
is still close to 11%.
Research shows that countries listed companies although the average
net assets generally higher than the local average investment profit
margin, but they will not exceed 150% of this range.
Therefore, only when the stock's average price does not exceed 1.5
times the net assets per share, the proceeds to invest in the stock
market and bank savings or other investments rather average. The
listed company when the stock price more than the average 1.5 times
net asset value after the proceeds to buy shares than other
The above conclusion is that the overall average relative to the stock
market, and on one or a small number of listed companies are not
applicable. If a superior level of management of listed companies,
market share, higher long-term stability and can, means of production
and more advanced technology and equipment, of course, the stock price
to see the high line, but not more than three times net assets. From
1994 statistics, the net return on equity of listed companies over 36%
of the only two more than the average level of up to 3 times more
still account for less than 1% of the total in 1995, the situation is
basically the same.
Content through the net assets of the lower stock prices can be
determined. As long as a listed company business scope does not belong
to the state policy to limit the development of the industry or a
sunset industry, when its stock dropped to levels below its net assets
to buy this stock on the worthwhile. Net assets when the stock price
down to levels below the listed companies are faced with a takeover
and merger issues. For investors, the funds with the same building
with a listed company and that companies of similar size, might as
well buy in the stock market is more convenient, it not only save lots
of preparation work such as reporting, election pull and feasible of
research, the acquisition of an existing listed company can also be
used to save construction time, and there are ready-made employees of
listed companies, the sales network can be used and so on. Listed
company is acquired, the acquired company can reorganize its
production, such as by adjusting the product structure management and
other measures to rapidly improve their operational efficiency. It can
argue that the stock's lowest price can be set at 80% of net assets
per share or more.
For rational investors, buying stocks can be controlled in the average
price of the average net asset value of between 80% and 150%, that is:
0.8 ¡Á average net assets per share "The Equity of the average
price of <1.5 ¡Á the average net assets per share
In this context, the purchase of shares will have a high investment
value. Beyond this range, the purchase will have a greater risk of
stock market speculation in the atmosphere may be a strong number, is
stuck with the higher likelihood.
For stocks, it does well and a listed company, its stock price to see
the high line, but the maximum price or should be limited to less than
three times the net assets per share.
0.8 ¡Á net assets per share "Stock Price <3 ¡Á net assets per
share of assets because of the assessment, there are still many
problems in the listing, there was the content of the net assets of
listed companies is significantly overvalued , such as some listed
companies return on net assets year after year are below 10%,
significantly below the industry level. Content of the net assets of
such enterprises may contain more moisture, investors in the stock
selection should be addressed.
Some researchers put the stock price and profit growth of listed
companies linked to that price and profit growth should be
proportional. This contact is not appropriate especially for the
Shanghai and Shenzhen stock markets, because the development of many
listed companies are quantitative rather than qualitative, and that
their profit growth was mainly because of the continuing increase in
net assets in placement results, but the unit assets The yield has not
been the slightest improvement is difficult to investors in the
development of such companies from getting any benefits. This is just
as bank savings, the interest rate is fixed, as long as depositors
more deposits, the total interest will certainly be simultaneously
increased. Even if the listed company's net assets yield rate on the
rise every year, but it is there are limits. Overall, the stock
market, the average return on net assets in other areas will not
exceed the average investment rate of return (one-year deposit
interest rate) of 50%.
For the individual listed companies, the net return on assets is the
ultimate level of three times the one-year deposit interest rate.
Accordingly, if the purchase price of the stock more than three times
the net assets per share, the same amount of money received benefits
to compare bank deposit rates.
Let the one-year bank deposit rate i, a listed company's net assets
yield 3i, is 3 times the bank deposit interest rates, the stock price
P, the net assets per share, J. When stock prices were 2.9 times net
assets, 3 times into 3. 1 times, the judge in the same amount of money
investing in stocks and bank deposits on the merits.
No matter how the price of the stock, because it does not affect the
net assets per share, the year of investment income generated will be
constant, the proceeds are:
R = return on net assets Net assets per share *
= 3J * i
(1) When the stock price per share of its net assets, 2.9 times the J,
it will deposit the same amount of money 2.9J banks receive deposits
2.9J * i, the same than the deposit of funds to buy shares Bank of
(2) When the stock price per share of its net assets of J 3 times, it
will deposit the same amount of money 3J banks receive deposits 3J *
i, the same funds to buy the stock received the same income and bank
deposits. (3) When the stock price per share of its net assets, 3.1
times J, it will deposit the same amount of money 3.1J bank will
receive interest on deposits 3.1J * i, the same funds to buy the stock
proceeds lower than bank interest.
The purchase of stocks, such as the listed company's net assets yield
savings rate over the same period a times, to make the stock market
return on investment of not less than the interest savings over the
same period, the stock price can not exceed a net asset per share
times the .

Fifth, psychological factors and stock

Mental activity of investors with its great influence on investment
decisions, some of which have a psychological tendency of stock prices
significantly adversely affected.
1. Herd mentality. Subordinate to the majority of modern social life
and economic life of a criterion in the stock market, most investors
believe that the majority's decision is reasonable, so in their own
market and the stock market without understanding the situation of the
situation, blind adherence operation and chase sell to others to
follow suit, this is the herd mentality in the stock market. The main
herd mentality of stock plays the role of amplification. Stage in a
bull market, some investors see others buying the stock to be easy to
think that the stock market bullish, lest behind, lost profit
opportunities, the market outlook in the circumstances there is no
hurry to grasp the purchase, resulting in stock price rise. And
because the impact of earnings to buy shares, more and more investors
influenced by others, and regardless of how the actual macroeconomic
situation, the management of listed companies for the analysis is not
to start buying stocks, and promote further increases in stock prices
. With the wealth effect of stock market gradually expanded to more
and more investors enter the market, and finally even some common on
the stock market and financial market are indifferent to the citizens,
and thus stock prices to a reasonable height, forming a Short-term
bull market. Conversion to the bear market in a bull phase, some of
the more rational investors will take the lead to the withdrawal of
funds from the stock market, causing stock prices fell, other
investors sell the stock to see other people, but also that some
bearish stock market, fearing their loss, along with others sold to
make a decision immediately. With the further deepening the stock
declines, more and more investors to sell stocks to follow, and
finally caused the stock market crash.
2. Expectations. Refers to expectations of future stock price
investors, and various factors affecting the stock price changes in
the psychological expectations. Downturn in the stock market, the
stock has fallen to very low levels, most of the net assets per share
fell to less than, but most investors are indifferent, cautious wait
and see attitude, resulting in further decline in stock prices. Once
the market turned over to shareholders in the role of expectations,
but willing to race to a higher price to buy stocks, and indeed share
prices soaring. In contrast, the stock price at the top region,
investors are unwilling to sell, waiting for further price increases,
and when the stock started falling, and that the stock price to fall
much, they have joined the selling team.
As the stock price investors are too optimistic about the future
trend, it is possible to the castles in the air to raise the level of
stock prices, such as raising the price to average net assets, or even
5 times 3 times the level of the stock was out of its intrinsic value.
3. Preferences psychology. Psychology is the preferred stock investors
in the types of investments, tend to a certain class or certain kinds
of stocks, in particular, tend to do their favorite stocks or
frequently. When large organizations prefer a stock, because of their
strong purchasing power, or sell in large quantity, it will cause the
stock price from the general trend, showing a violent oscillation.
Some stocks such as Shanghai, the annual after-tax profit of around
0.1 yuan also due to the preferences of large number of institutions,
it will be pulled close to the stock price of 30 yuan, and when large
shipments, the price dropped , resulting in the tragic loss of a
number of retail investors to follow suit.
4. Knucklehead. In the stock market, there is a popular saying that
stock trading is a fool and an idiot racing, not afraid of their
sleepwalk cheap to buy or sell at high prices as long as people more
stupid than he is willing to take a more higher price or sell more
cheap that he will be able to be profitable, this mentality is a
knucklehead. As knucklehead, many investors do not study the financial
status of listed companies and the investment value of the stock as
long as people buy to follow the buy, was sold along with his sales,
resulting in a sharp price oscillations, the market-risk. If China's
Shanghai and Shenzhen stock markets, as investors in China is not yet
mature, and chase sell the wind, line, price is often a substantial
oscillation, which is shareholders knucklehead at play, as long as I
buy, someone will a higher I bought the stock price; as long as I
sell, someone will sell at a lower price, so that they can make
progress at a low price.

Sixth, the stock market and stock price manipulation

Stock described in sections above, and the operating performance of
listed companies, the share price and average profit margins, stock
levels and net assets of the relationship between stock price
movements are rational motivation. Because of these motives, investors
will be to mobilize funds to buy shares or sell shares in pursuit of
higher investment income. But in fact, the stock of Change is the
result of the movement of funds, with some motivation after the only
person to buy or sell, causing changes in supply and demand, resulting
in ups and downs of stock prices. In the stock market, some big
institutions altogether on the use of their strong financial strength
to lift or suppressed stock prices, this is the stock market
manipulation. The main approach is through the buying or thrown in
large quantities, causing the supply of a stock changes in funding,
resulting in a sharp price ups and downs.
In the stock market, as long as shareholders have a number of funds or
the stock reaches a certain percentage of stock price movements can be
so arbitrary, and thus control the stock price to profit. Such as the
Shanghai Stock Exchange was in a listed company within a day doubled
their share price pushed up, and more, a broker in Shenzhen Pro within
minutes before the close of a stock's price will pull more than twice
as high, so the price is the financial strength of a reflection
period, retail investors on the stock market should be Duojia Ti
against such manipulation, and should not blindly follow the trend, so
as not to lose fooled.
The behavior of large institutions able to manipulate the stock price
to succeed, the reason is that small retail line of thinking, that
after seeing the stock price up to think it will, and see the price
fall that it will fall. The big institutions will be the stock price
is bound to throw Scoop will be suppressed to a certain extent shares
must buy.
In the stock market, large institutions a common means of manipulating
stock prices are the following:
Monopoly. Large retail organizations to be trampled upon, often in
huge funds to purchase a stock, to reduce the number in circulation,
and then release rumors, luring retail investors to follow up, so that
the formation of a bullish market sentiment, coax care market, price
to be considerable height, and then quietly throw all the stocks and
profit from. And because the number of shares held by large
institutions are more, once sold, will result in the sharp decline in
stock prices, causing retail investors stuck. Another way is to sell a
large number of shares before large institutions to increase market
share chips, while bad news released, causing retail investors panic,
followed by large sell-off, the formation of decline, this time to
absorb large dark again, higher than the promotion, for profit .
Together. Two or more large organizations in private channeling, while
trading the same stock, to create a false supply and demand of stock,
in order to affect stock price volatility.
Together usually in two ways: First, both come together in the large
number of funds to purchase a stock or a stock in order to throw the
same time price rises or falls; Another way is the way to the see-saw
trading, that is, a few a big turn up or down lift prices weigh on
prices. A first such large price of 10 yuan to buy large B then the
price of 11 yuan to buy, and then again A big price to 12 yuan to buy,
in turn pull up the price.
On the knock.