Markets — Shares
Prices follow earnings, expectations and rates.
Equities are ownership in a business, but share prices are driven by the gap between expectation and reality. Context is what separates the two.
Educational overview. Not investment advice and not a recommendation of any company or security.
Embedded chart for information and education only. The instrument shown is not a recommendation.
At a glance
Key characteristics
Risk note
Leverage can magnify losses as well as gains. Understand the instrument, its liquidity and your own tolerance for loss before taking a position.
What moves this market
The drivers worth following.
Earnings and guidance
Results matter, but forward guidance often moves prices more than reported history.
Interest rates
Rates affect the discount applied to future cash flows and the relative appeal of equities.
Sector rotation
Capital moves between sectors as the economic outlook and risk appetite change.
Valuation
A good company can be a poor investment if the price already assumes too much.
Liquidity
Large caps and small caps can behave very differently under stress.
Corporate events
Dividends, buybacks, splits and mergers can change the investment case.
How to approach it
A framework, not a forecast.
Use these questions to structure your own research. They are prompts for thinking, not trading instructions.
Build the fundamentalsWhat does the market already expect from this company, and how demanding is that expectation?
How sensitive are the company and sector to interest rates and the economic cycle?
What would need to be true for the current valuation to be justified?
How liquid is the stock, and how might that change during stress?
What is the invalidation point for the thesis, and how is the position sized around it?
Continue
Research companies, not just charts.
Read the indices overview for the macro picture, or start with the foundations track in the education hub.