How Exactly Do Stock Prices Get Determined?

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Stock prices are determined by matching buy and sell orders. Each buy order is an offer to buy certain number of shares for a certain price, called bid. Each sell order is an offer to sell certain number of shares at a certain price called ask.The price of any stock at any moment is determined by finding the price at which the maximum
 number of shares will be transacted. After that price is determined, the transactions are completed and that price is shown as the price of the stock at that moment. 

 

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