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Sell my Share!

So in the previous article 5 people have a company each has a share of stock in the company but Maral decides she wants to sell.  If this were a publicly traded company she would sell her share on a stock market to someone who wants to buy that share.  Typical places you would find the stock available to sell would be on an exchange or stock exchange; examples would be the New York Stock Exchange, NASDAQ, Chicago Board of Options Exchange and foreign markets like the British F.T.S.E. (Footsie).

Maral takes her $200,000 share and sells to highest bidder, the new buyer decides he will pay $210,000 to Maral to purchase.  The exchage completes the sale through brokers, commissions are paid.  Now each of the previous shareholders, now have a share that is worth $210,000.

How can this be?  The company is only worth $1,000,000.00 but you are now stating it is worth $1,040,000.00 this doesn't make sense?  While the stock now shows a slight inflation, the company is worth $1,040,000 because someone is willing to pay $210,000 to obtain it.  Eventually if we continued to say $225,000 or $250,000 a share eventually someone would say it is no longer worth that and it will not rise any further as a matter of fact it could fall even below the original price Maral offered it at $200,000 that is why you see the stock market go up and down everyday.  The company has bad news or earnings stock goes down, company launching new product, service or expanding production stock goes up in value.

There are a multitude of outside influences, such as competition, overall economy, treaties, price of commodities and other factors affect that price.  I am not here to teach Economics 101 for college credit so you will have to do some research on your own.  I will however mention these influences when I am giving you a stock pick and why I feel it is going to go against what other pundits say, or why I agree with them.


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