Why do stocks make money and why do stock lose money?

Question

Why do stocks make money and why do stock lose money?

Answer 1

Stock make money because the company is good. You lose money if you choose the bad company. (Fundamental analysis). You lose money if your timing is bad, and you make money if your timing is good. Learn more, and you can choose well.

Answer 2

Buy low sell high = make money.

Buy high sell low = lose money.

Before you begin to invest, make sure you study that company thoroughly before buying it. If you want to speculate, then you need to learn how to watch the chart and how's the market doing.

Answer 3

Your question needs clarification. If you mean stocks, i.e. companies, well thats obvious they are either profitable or loss money.

If you mean why stocks go up and down and the shareholders may make or lose money. Well, the most simple answer is when there are more buyers of a stock than sellers, the stock will go higher, and vice versa.

The factors that determine the volume of buyers and sellers, however, are multiple and not always clear at the time of the buying and selling.

Answer 4

Many stocks are overvalued, for example a company plans to go public, so there is a lot of hype in the market before hand.  When people buy in, they then find that the company isn't run so well and they try to get out, so there is over supply of shares.  Over supply will drive down the price, thus lowering the value of the shares.