You can check the value of stocks share online, in apps on your phone etc… But what is that value really? And how do we know on real time how the value has changed.
For example, if a company increases profits its value in the stocks will increase, but what is recording the incomes of the company? Is it connected to a similar system that the bank uses to store money? Is it similar to an internet network?
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Stock price isn’t actually based on what the company’s true value is. It is based on the market; what people are willing to buy share for. So many companies end up having stock values way above the actual value if you were to auction off all the company’s possessions (Apple and Tesla, to name two classic examples). Other companies end up having stock values lower than their true value, simply because people aren’t interested in investing.
So the stock price listings just show the price that people are currently paying when buying that stock. In modern times, stock trades are done electronically so the value can determined and updated near instantly online by simply watching the electronic transactions. In the olden days when stocks were traded by hand, stock price listings were much slower. Reporters would monitor and write down stock prices from transactions as they heard or saw them occur, or would wait until closing time and see what the last transaction price was. Most people got stock prices in the financial pages of the newspaper, while those with lots of money and interest could pay to have a special telegraph line which provided stock prices (called a stock ticker). These tickers output prices on a long narrow ribbon of paper tape, and they generated lots and lots of paper tape each day. During parades in big cities, people would throw old stock ticker tape out the windows as confetti, hence the term “ticker tape parade”.
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