DEFINITION of 'Market Price'
The current price at which an asset or service can be bought or sold. Economic theory contends that the market price converges at a point where the forces of supply and demand meet. Shocks to either the supply side and/or demand side can cause the market price for a good or service to be re-evaluated.
BREAKING DOWN 'Market Price'
For example, suppose that the market price for a widget has been $10 for a number of years. Suddenly, the market price shifts to $20 when it is announced that only half of this year's widgets will be sold in stores. In this case, a drop in supply causes the market price to increase.
In regard to stocks, the market price of a stock is the most recent price at which the stock was traded. It does not guarantee that an investor will receive the same price upon buying the stock afterward. For example, suppose that a company's stock has been halted from trading because it was planning to release some material news in the next hour. While the market price of the stock at the time will be the last price at which the stock traded, buying the stock when trading resumes will definitely yield a different price.
-
Supply
A fundamental economic concept that describes the total amount ... -
Theory Of Price
An economic theory that contends that the price for any specific ... -
Beginning Market Value (BMV)
The valuation at which the property should exchange at the date ... -
Microeconomics
The branch of economics that analyzes the market behavior of ... -
Economics
A social science that studies how individuals, governments, firms ... -
Macroeconomics
The field of economics that studies the behavior of the aggregate ...
-
Investing BasicsThe Upside of Picking Stocks Nobody Follows
Learn about the upside of picking stocks nobody follows. The less followed a stock, the more opportunity there is for a stock being incorrectly priced. -
EconomicsEconomics Basics
Learn economics principles such as the relationship of supply and demand, elasticity, utility, and more! -
Investing BasicsWhy Do Companies Care About Their Stock Prices?
Read on to learn more about the nature of stocks and the true meaning of ownership. -
Investing BasicsWhat Is The Impact Of Research On Stock Prices?
The answer to this question is directly related to the importance of information in the marketplace. -
Forex EducationUsing The Price-To-Book Ratio To Evaluate Companies
The P/B ratio can be an easy way to determine a company's value, but it isn't magic! -
Options & FuturesExplaining The World Through Macroeconomic Analysis
From unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone. -
Investing NewsHow Banning Buybacks Would Help the Economy
Stock buybacks are popular, but they're not helping the economy. Here's what would happen if they were banned. -
Mutual Funds & ETFsCan the Best Mutual Funds of 2015 Repeat in 2016?
Here are the top five mutual funds of 2015. Do any of them have upside potential this year? -
Investing BasicsExplaining Wedding Warrants
A wedding warrant is a warrant that can only be exercised if the host asset, usually a bond or preferred stock, is surrendered. -
Investing BasicsWho is an Accredited Investor?
Essentially, accredited investors are knowledgeable and experienced enough to handle the risk that comes with investing in unregistered securities.
-
Where do penny stocks trade?
Generally, penny stocks are traded through the use of the Over the Counter Bulletin Board (OTCBB) and through pink sheets. ... Read Full Answer >> -
Where can I buy penny stocks?
Some penny stocks, those using the definition of trading for less than $5 per share, are traded on regular exchanges such ... Read Full Answer >> -
How does the stock market react to changes in the Federal Funds Rate?
The stock market reacts to changes in the federal funds rate in various ways depending on where it is in the business cycle. ... Read Full Answer >> -
What are the requirements for being a Public Limited Company?
The requirements for an entity to be considered a public limited company (PLC) include registration requirements, establishing ... Read Full Answer >> -
How do I place an order to buy or sell shares?
It is easy to get started buying and selling stocks, especially with the advancements in online trading since the turn of ... Read Full Answer >> -
Is there a difference between financial spread betting and arbitrage? (AAPL, NFLX)
Financial spread betting is a type of speculation that involves a highly leveraged derivative product, whereas arbitrage ... Read Full Answer >>