What is the operating principle of stocks?

Stock This is a typical security. Generally speaking, stocks fluctuate with the company's value. For example, the share price of Changsheng Bio is 0 and it is directly delisted. Kweichow Moutai's annual performance has maintained double-digit growth, and its share price is moving towards breaking the thousand. These are all driven by the intrinsic value of the company, so the stock is a kind of valuable securities with commodity attributes.

Commodity has an obvious attribute, that is, the relationship between supply and demand determines the price, so the operation principle of stock is also because of its supply and demand attribute. If there are more buyers than sellers, there will be oversupply and the stock price will rise. On the contrary, supply exceeds demand, and the stock will decline. In view of this phenomenon, when the stock price falls, many companies have plans to increase their holdings, and when the stock price rises, they have plans to reduce their holdings, and the stock price falls. These policies also exist based on the attributes of stocks.

In China's stock market, the stock market is divided into primary market and secondary market. There is a very obvious phenomenon between the two, that is, the primary market is relatively stable, most of the shares are held by a few people, while the secondary market is relatively liquid, and the shares are held by the vast majority. So because of the different audiences, there are many rules between them.

In the secondary market, for a stock, the amount of funds is almost unlimited. Therefore, if the main force continues to collect stock shares under certain conditions, the corresponding stocks that can participate in trading will gradually decrease, and things are rare, and the main force that cannot buy stocks will continue to rise in the process of rising prices. In this way, the price of individual stocks will gradually be overvalued, thus promoting the main shipment, liberalizing the market supply, gradually declining the stock, and finally the price is reasonable.

This is the principle of stock operation, which changes the relationship between supply and demand through the commodity attributes of stocks.