The price level of a share can be compared to a soldier under ambush. He is being attacked by enemies from all directions and yet he has to make efforts to hold on to the position and make further advances! He can not tackle one enemy at a time. Similarly more than one factors influence the price of any share. They are business related; political issues, economic upheavals and human psychology play an important role determining the level of prices.

The common investor does not have the time and patience to analyze each and every part of his investments that one holds. You are generally guided by what you read in the newspapers and discussion amongst friends. Panic sales are very common. You sell a stock because others are selling it; you buy for others are buying it.

The important business factor is company's earnings. When the earnings increase, the same will have beneficial effects on the share price. The future projections by the company and the estimated profits will also influence the prices. But in this age of industrial and internet revolution what happens in a part of the globe, may adversely affect a particular product in many countries of the world. The other prominent factors that will affect the market are inflation, political upheavals, terrorist attacks and oil prices.

Analyzing and estimating the share prize, is the domain of the human mind. Therefore, it varies from person to person as per one's perception. One may expect the downslide due to impending war as for the shares of construction companies. The other analyst may think that post-war reconstruction activities may push up the prices.

Every action has the reaction and what type of reaction it creates, is again a mater of interpretation by the analysts. Lay offs for example. Because the expenses will be drastically reduced, the same will have the quick effect on prices. If the sales are not up to the expectations, layoff is the quickest remedy and that will boost the prices.

Another important factor is the analyst's recommendations. You see a mushroom growth of specialized periodicals and you get to read articles from the experts. On the basis of the study, they recommend certain shares and caution the investors about the slides. This creates enthusiasm or panic amongst the buyers and you see lots of swing in the prices following the publication of such articles.

With all the internet facilities, strategies, analyzes and expert forecasts, none has ever succeeded in making correct forecasts as for movement of prices. When the prices will skyrocket or when they will hit the rock bottom is anybody's guess. This is an area the sudden developments in which baffle the Finance Ministers and the Central Bank Governors. In most of the cases they have apparent remedies but no real solution. The market, sooner or later, stabilizes of its own, and nobody knows why it has behaved the way it has behaved. You have to bear with such rough rides and protect yourself. Plan your investments by taking into consideration all the factors affecting the stock market.

Understand all such factors and curb your appetite to act beyond your means. Adventurism is a wrong move, but you can take calculated, manageable risks. Stocks are articles of business, and one should not get emotionally attached to any. Buy when you have strong reasons to buy; sell when you have no reasons to hold.