I require Help?

[cemcompusoft]

One question,

Taking the above example, if I want to buy 1750 shares, what will be my average purchase price?

Pranay

500@100/-.....1000@101/-......250@102/-........you avg price will be 100.86

 

[mahmeds2000]

Raising and falling of share price in stock market is a question of demand and supply. To be precise, the demand and supply situation at that precise moment. If the supply is less and demand is more, share prices will rise. On the otherway round, i.e. if the supply is more and demand is less, share price will fall. Sometimes, these supplies and demands are artificially manipulated. That is what we call as price rigging. To my knowledge, there is no other explanation for it. If any one else has got better answer please post it here.

hi munchiana,
i got this. How on low volume share prices rise and fall? . Suppose one ABC company is there and nobody wanted to sell it and bid qantity is suppose only 1000 and offer is 0 then in this situation what happen?

thanks
wrgrds
Ahmed

 

[pranayd]

In such case, I guess the trade will not get executed and the price will remain unchanged (the LTP).

Hope I'm right!! Other members, please correct me if I am.

 

[cemcompusoft]

In such case, I guess the trade will not get executed and the price will remain unchanged (the LTP).

Hope I'm right!! Other members, please correct me if I am.

trade will exeecut and LTP wil be 102/- with offer price 102/- & offer qty will be 1250......trade will always execute if you order at market prise & if there is offer qty.

 

[pranayd]

Cemcompusoft,

My previous post was in response to Ahmed's question jjust before my post. I clearly got your answer, thanks.

Pranay

 

[pkjha30]

trade will exeecut and LTP wil be 102/- with offer price 102/- & offer qty will be 1250......trade will always execute if you order at market prise & if there is offer qty.

Hi

If it is limit buy trade will not execute.Futher since offer is 0 trade will not execute.
if you put market price 1000 will get executed and remainning will become limit order and will not be executed if no offer at that price(BSE) For NSE you will get different price and trade will getexecuted if there is offer at any price.

pankaj

 

[munchikana]

hi munchiana,
i got this. How on low volume share prices rise and fall? . Suppose one ABC company is there and nobody wanted to sell it and bid qantity is suppose only 1000 and offer is 0 then in this situation what happen?

thanks
wrgrds
Ahmed

Nothing will happen. As long as buyer and seller do not agree upon price, no transaction will take place. That is what I was suggesting. Supply and demand means intention to supply at a particular price and demand at that particular price. That is what I said demand and supply situation at that precise moment. Now you seem to have some confusion with regard to the trade software installed at NSE or BSE and its method of execution of trade. Be clear with fundamental theory. Rest of the things you will understand quite easily. See the posting given by learned senior member Pankaj Jha just below this post. Software at the exchange terminal will interpret higher buy order as the order at the offer price and execute the trade at the offer price. I make it further clear. Suppose if share is offered for sale at Rs.100/- and you place buy order at Rs.101/-, exchange terminal will execute the order at Rs.100/- and not at Rs.101/-. That is what is called as meeting the mind of buyer and seller. If the demand is more, naturally seller will sense an opportunity to make money. He will offer at higher price. If the demand is less, buyer will sense and opportunity and he will offer less. That is how prices gyrate.

 

[kuldeep49]

What is precisely the role of the Market Maker in all this? How does he operate?

 

[manugoyal]

What is precisely the role of the Market Maker in all this? How does he operate?

In short Market Maker is the entity that buys from the seller and sells to the buyer making some money in the difference between buying / selling price.
The Bid / Offer quote you see are from the market maker.

Please correct me if I am wrong.

thanks
m

 

[mahmeds2000]

Hi munchikana,pkjha30,
Thanks a lot for the reply. Specially senior member pkjha30, now a days i use to read te great thread "The Crash( 17.5.2006) and FII activities since then" of pkjha sir. Always i am looking for new post in this thread really improving knowlege. Also i would like to congratulate munchikana for becomming member over here.
Still i have some doubt. I am not able to understand how when the volume of the shares is low, share price rises sharply and fall sharply? According to me if the volume is less means less buyers and less sellers so how the share moves sharply either in up direction or down. for example if we see "Gujarat Gas Company Ltd. - (BSE)" today its volume is 706 very less and it falls 20%. Also if u see the volume of this company on 10 may at that time again it was nearly 700 but at that time the share was only 3-4% down. Also sometime with a very small volume price is 20% up.
So please help.

Ahmed