What Affects the Price of a Stock? | Stock-Specific vs Market-Specific Factors
Have you ever wondered why the price of a stock goes up or down ? Itโs not just numbers on a screen โ there are real reasons behind every movement in the stock market. Today, weโll break it down into two key categories : Stock-Specific Factors Market-Specific Factors ๐ 1. Stock-Specific Factors These are factors unique to a particular company . Theyโre based on: Public perception Future earning expectations Quality of management Marketing strategies Innovation and product appeal ๐ง In simple terms: Itโs all about what people think will happen with that company โ and how much they believe in its success . ๐ Example: Letโs say Company A launches a new sunglasses brand and uses Gen Z influencers and celebrities to promote it. What can happen? ๐ Option 1: Investors love the idea, see potential in Gen Z marketing, and start buying the stock . โค This increases demand , and the stock price goes up . ๐ Option 2: Some investors feel Gen Z is too niche...