The price of a single share of stock. Very important number.
So...let's say there are 40 million shares outstanding in a given company, and you've paid 10 bucks for a single share of stock. That 10 buck price then values the entire company at $400 million. You just bought one 40-millionth of it for 10 bucks.
So what makes a stock price? Well, the market. Buyers and sellers come together in a financial orgy called NASDAQ, or the NYSE, or the LSE, or the HKSE, and many others where supply meets demand and a stock price is, um...born.
Related or Semi-related Video
Finance: What is Fair Market Value?3 Views
Finance a la shmoop what is fair market value? double bubble toil and trouble [Man casting a curse]
what is the fair price of this pile of rubble so this term revolves around the
notion of fair like what is fair and by the way who told you the world was fair
anyway all right but financially fair or at least fair market means what the
market will fairly and legally pay for an asset that's fair and so that means [Man discussing financial fair]
fair as in not cash from a Somalian warlords leather briefcase but rather
fair as in the legitimate selling price of this excellent two-bedroom three-bath
shoebox in Palo Alto selling for 3 million dollars today for something to
be "of fair market" the buyer has to be knowledgeable and
unpressured i.e the somalian warlord does not in fact have a gun aimed
at the buyers head or any other body part and generally speaking [Gun aims at buyers body parts]
the market itself has to be a legitimate market like real estate or jewelry or
stocks or bonds or whatever if it's an illegitimate market well it's a probably
wondering why it was born out of wedlock so you can't do that
when you assess fair market value things have to be legal and liquid and well
fair whatever the market will pay for it that's the fair value [Hand dealing out cash]
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