# Stock market price

Microsoft's share price from September 2004 to February 2005
Floor workstation on the Frankfurt Stock Exchange

The stock exchange price ( legal term : stock exchange price ) is the price of a trading object determined on a stock exchange .

## General

The objects of trade include financial instruments (for example securities ), foreign exchange or other fungible assets traded on a stock exchange , for example commodities such as raw materials (examples: crude oil , gold ) or agricultural products (such as wheat or soy ).

The stock exchange price results from supply and demand for the traded good. In principle, the lead brokers or stockbrokers first receive all purchase and sale requests ( securities orders ) and then calculate the rate at which the greatest turnover is achieved, i.e. as many of the existing purchase and sale requests as possible can be fulfilled. This is followed by the actual determination and publication of this stock exchange price by the lead broker, also known as the listing .

## Legal issues

The stock market price is a legal term that appears in many laws. In particular, the lower of the § 253 para. 4 HGB plays the stock market price in addition to the market price at the valuation of the current assets of companies at the balance sheet date the decisive role. Under commercial law, the stock market price is identical to the fair value .

The Stock Exchange Act (BörsG) applies to the operation and organization of stock exchanges, the admission of trading participants, financial instruments, rights and assets to stock exchange trading and the determination of stock exchange prices in accordance with Section 1 of the Stock Exchange Act . Prices that are determined on a stock exchange during trading hours are stock exchange prices in accordance with Section 24 Paragraph 1 BörsG; they must be established properly and correspond to the actual market situation of stock exchange trading (Section 24 Paragraph 2 BörsG).

In order to systematically rule out excessive volatility in the prices, "extraordinary daily fluctuations or sudden developments within a few days that do not solidify" must not be taken into account in the averaging of the stock exchange price; instead, the mean value of the stock exchange prices of the last three months before the reference date is to be taken into account form. Further stock market price distortions due to tight markets or a lack of market liquidity may not be taken into account in severance actions .

## economic aspects

A distinction is made between spot rates , forward rates and - in the case of commercial objects with no turnover - taxi rates (estimated rates). The minimum closing date for shares has been abolished in Germany since May 2011; for bonds it is based on the minimum investment amount. As a result, the spot price for shares is no longer relevant. The price determined is always between the bid price as the lower limit ( English bid ; minimum price at which buyers are ready to buy) and the ask price as upper limit ( English ask ; maximum price at which sellers are ready to sell). The difference between bid and offer price is called the margin ( English spread ). In the case of foreign exchange, however, the spot rate plays a decisive role. The spot rate is composed of a lower bid price, ask price higher and an intermediate middle rate ( English mean rate ). The latter is determined as part of the price determination, with the bid and ask prices resulting from the application of the fixed rate ranges .

With stocks and bonds, it is important to distinguish between their face value . The nominal value refers to the registered capital of a joint stock company and is in front of the emission set of stocks, bonds at par value is the amount for which the loan on the due date of the issuer will be repaid.

example

From BMW are a total of 602 million shares with a nominal value of 1 euro each. This share was traded on the Frankfurt Stock Exchange on March 20, 2015 at a market price of 114.60 euros per share. In the previous 12 months, the stock exchange price fluctuated between EUR 74.90 and EUR 123.70 per share.

## Key figures

The stock exchange price is an important benchmark . It is used to generally calculate the market value and , in the case of stocks, also the market capitalization . A price gain results for the seller if the selling price is higher than the buying price, conversely it is a corresponding price loss :

${\ displaystyle price gain = selling price> buying price}$.

The price / earnings ratio and the stock index are also business indicators , for the determination of which the stock exchange price is necessary.

## Course types

According to the buyer's or seller's rate:

After the time of course determination :

• Opening price - the first determined price on the trading day
• Closing price - last price determined on the trading day.

According to the type of course determination :

• Continuous course (variable course) or
• Spot rate (also called unit rate ).

According to the quality of the course:

• Official market price or
• Taxakurs - Can a security has no price be determined, which may be the case for low-revenue securities, the competent securities trader puts an estimated price, the Taxakurs fixed ( tax , rate tax ). The case occurs when there have been no orders and therefore no sales have been made.

In addition to these observed in the stock markets courses, there are courses by brokers and dealers over the counter direct business ( English over the counter , abbreviated OTC) are fixed, so-called OTC courses. This price information is not conveyed via stock exchanges, but is traded via market data systems at traders.

## Course supplements

Price additions indicate the extent to which the buy and sell orders for securities, which are limited at the determined price , could be executed in floor trading , or explain any price changes that occurred during the official listing of the securities (examples: subscription rights trading discount, dividend payment). The additives are used by almost all stock exchanges.

## Course notes

The price notes indicate how the prices came about in the course of trading. In contrast to the course supplements, the course information is not regulated in the exchange rules.

• G = money, at this rate there was only demand. There was no turnover.
• B = letter, there was only an offer for this course. There was no turnover.
• au, aus = suspended: The quotation is suspended , an exclamation is not permitted
• C = Compensation transaction: At this rate, only orders were carried out for which buyer and seller were identical.
• ex abc = without different rights: First note, discounting different rights.
• ex AZ = after compensation payment: first note with a discount on compensation payment.
• ex BA, ex Ber = according to bonus shares: This is an addition to the price in the event that a correction discount has been made. It is the first note after the exchange rate has been changed to the adjusted share capital (from company funds).
• ex Bo = according to bonus rights: First note under deduction of bonus rights.
• ex BR, ex Bez = according to subscription right: This is a price addition on the day of the subscription right discount. With immediate effect, the price of the new share will be traded with a discount (without subscription rights). It is usually the penultimate trading day before the subscription period expires.
• ex D, ex Div = after dividend: This is a price supplement on the day of the dividend payment, usually the second trading day after the general meeting. The dividend for the past financial year was paid out to the shareholders and is deducted from the price of the share (“dividend discount”).
• ex SP = after splitting: First note after the exchange rate has been changed to the divided shares.
• ex Z = excluding drawing: the quoted price is for the pieces that have not been drawn. The reference is to be used only on the day the listing is resumed. Plus and minus announcements.
• ex ZS = after interest: First note with deduction of interest.
• * = Asterisk: Small amounts could not be traded in whole or in part.
• T = estimate, there were no sales, the rate is estimated.
• - = deleted, no course could be determined.