Up and down
You often hear the stock market likened to a supermarket and indeed we mentioned this earlier. Well it is probably more correct to compare it with a fish market, or the local meat market.
Whether it's fish, meat or shares, the market performs the same basic task - matching buyers with sellers.
Prices are dictated by supply and demand.
Taking our food market example, the best cuts and freshest fish will be most in demand and therefore command the highest prices.
In the stock market, the main drivers of the share price are the outlook for profits and the risk associated with the investment.
So if the market reckons a firm's profits are set to balloon over the next few years, its shares will be more sought after than stock in a group whose earnings are forecast to drop.
Information is king when it comes to setting share prices.
While it is impossible to know every minute detail about a company, or predict the sometimes whimsical ebb and flow of markets, news of a firm's fortunes is important in determining whether to buy or sell shares.
So it follows that shares will rise and fall on news - going up on good news and down on bad.
Hope you are with me so far.