So if this equality always occurs, why do the prices of stock shares ever change?

Question

For each stock in the stock market, the number of shares sold equals the number of shares purchased. That is, the quantity of each firm’s shares demanded equals the quantity supplied. So if this equality always occurs, why do the prices of stock shares ever change?

Answer 1

Demand.

You're referring to the transaction. Where there is a buyer there is a seller.

There may only be 100,000 shares for example available from potential sellers, and 1,000,000 shares asking to be purchased by potential buyers... since only 100,000 shares are available to be bought, the buyer who offers the most, will get those 100,000 increasing the value of the shares (which are more or less worth whatever people are willing to pay).

The reverse would also be true. If there are too many people attempting to sell, and not enough people interested in buying, then you may have to undersell the shares, reducing their value.

Answer 2

because of the shift of either the demand or supply curve

the equilibrium that you are talking about is the result of the intersection of the demand and supply curve.

so when the curve shift so will the resulting price and quantity demanded and supplied

Answer 3

it's simple supply and demand like everything else.  the supply of stock shares are fixed. (unless there is a split) the more buyers there are for the stock the higher the price. when  there are more sellers of  the stock the stock goes down.

Answer 4

You're talking about volume of trade, which has nothing to do with the prices involved in each transaction.

Say, FGH Corporation. ,a manufacturer of high-tech widgets, is floated on the Exchange, a million shares are issued at 1 dollar each and are snapped up by investors immediately because investors have confidence in the future of FGH Corporation.

After the IPO, FGH is doing really well in performance and now everybody wants to buy a share. Since there are only 1 million shares floated, the investors who hold those first million shares could sell them for greater than $1 each and make a net profit. The market price of each trading entity share is determined by the demand and supply for the share - so the price isn't static.

That isn't to say stocks can just mysteriously appear and disappear. As long as FGH doesn't issue more stock, or buy them back from shareholders, there will always be exactly 1 million stocks on the market place. No more, no less. This is because each transaction requires a buyer and a seller, so it merely changes hands from seller to buyer. (An eccentric man could buy it, get a stock certificate for it, and burn it but it'd exist on the accounting books. Thats rare and exceptional.)