I get what causes a stock’s value to rise and fall in general but I don’t get where the exact numerical price of the stock comes from
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The big investment banks hire skilled analytics who will look at countless different factors to determine how much the company is going to make and therefore the potential return on investment. This is compared to the expected overall growth in the economy to get an estimate for how much the company is worth. From this valuation the investment bank is going to issue offers to buy stock at a lower price and sell at a higher price then what they think the stock is worth. The valuation changes all the time so they update their prices accordingly. What they are hoping for is that someone comes up with a wrong value for the company and that they will be able to make a good trade. When this happens the price at which they agreed upon is published for everyone to see and will update the stock tickers. This is then again used as a factor for the valuation of the company.
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