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Stock quote is the price of the stock at particular stock exchange. The stock quotes are determined on the basis of the demand and supply of the stock at a specific time at a particular stock exchange. The demand of the stock is the result of so many factors including the future of the stock and speculations of the investors about that particular stock. The overall market trend, performance of the company and the financial condition of the company all contribute to the demand of the stock. Therefore the stock quotes keeps changing during the trading hours at the stock exchange as the demand and supply of the stock also keep changing from time to time.
The stock quote is made by the market makers and they always have to give a bid price and ask price for a particular stock during the trading hours. The bid price is the price at which the market maker will buy the stock from you, while the ask price is the price at which he will sell the stock to you. The difference between these price is called the spread and that difference is the profit of the market maker. The spread widens for a share when there is low volume at the market or when a particular stock moves very fast. As the spread widens the risk of the market maker also increases as even if he has no body else to trade with he has buy or sell from you when you wish. To control this risk the market makers hugely control the spread and it is a determining factor for the stock quotes.
For an investors prediction of the stock is crucial. The stock quotes are predicted mainly through two methods – the technical analysis and fundamental analysis. The technical analysis is the mathematical calculation based that give a graphical pattern of the price movement and fundamental analysis is done on the overall market condition and future prediction of the company.
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