Get to know about the volatility of the stock market

Stock market has been a point of attraction for all those who love to have some side income with little risk and average amount of investment. However, there are many other avenues that one has to pay attention to. The volatility of the stock market is the sudden alteration in the price of the stocks. This very thing in the stock market is something which many people look forward to as well as many people hate also, and that varies with the experiences of the people in the investment in the stocks.

If the stock value is relatively stable and has no alterations, then the volatility is low but on the other hand, if the stock is highly volatile, then the stocks have dramatic increases and depressions as well. But again the volatility is an opportunity for many at the same time.  Here are a few of the factors that can bring volatility in the stock market:

  • Product or the service quality of the company:

The sale of the products surely depends on the quality of the product. Thus here comes the performance of the company. In this part, it’s all on the company and how hard it puts his best to provide the customers with quality service. When it comes to having a check on the performance of the company, then research can be made on the reviews given to the company online. This can demonstrate how consistent the company is in its performance. Most volatile stocks on earnings can be possible fruitful or can cause great loss also.

  • Marketing ability of the company:

Secondly, have a check at the marketing capability of the company and how the company can influence the people to increase their sale. This is a factor that makes the stock volatile. With the change in the marketing techniques of the company the volatility also changes. Most volatile stocks on earnings can be the best business opportunity or else can also be the hardest blow one gets in the stock market.

  • ESG factors:

The ESG factor stands for the environmental, social and governance factor which has a lot to do with the volatility of the stock market. For instance, a natural disaster is an environmental factor, a social movement being a social factor and the change of the government being a governance factor can bring a great difference in the stock market making the stocks volatile.

Thus these are the factors that can lead to the volatility of the stock market. A flexible and volatile market is a business opportunity as well as a matter of risk to the investment returns at the same time. Thus, one must consider these factors and then decide on the part of the investment to be made on the stocks. Going with the trend or with the void recommendation of the people can cost you a huge blow of loss. But again if the same is done by making the use o9f the self-understanding, then there would be miracles for sure.

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