The securities market price movement theories

Rostyslav Andriyovych Hnatyuk


The necessity of extensive research on the mechanism of the securities market price movement is indicated. The main theories that explain the essence of this mechanism are defined. Their main weak and strong sides are highlighted. The core ideas and comparative analysis of the most prominent securities market price movement theories are performed.

Introduction. Economists are always interested in the peculiarities of securities market functioning from. The study on the mechanism of the price formation on this market gives a possibility to understand better its essence and to suggest more efficient ways of its regulation. This actualizes the importance of putting our knowledge about the securities market price movement theories in the right order and defining their main common and distinct features.

Purpose of the article is to define peculiarities of modern securities market price movement theories and compare their weak and strong points in the context of their practical application.

Methodology. We have used the following methods in the research: historical and logical(in order to analyze existing works and articles devoted to the study of securities market price formation); comparative(to determine similarities and differences of the theories that explain the way securities market functions).

Results. We have come to the conclusion that there is not enough theoretical works on the securities market price formation mechanism. We believe that these theories could be only considered as hypothesis that still need to be further developed as none of those was persuasively proven. On the other hand, we have found out that the authors, in their study of securities market, critically use the theoretical achievements of their predecessors. Therefore we conclude that the theoretical aspects of securities market functioning require further research, which includes practical verification of existing hypothesis. 


securities market; stock market; securities market price movement theories; securities; efficient market hypothesis; behavioral finance theory

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