Many investors are interested in the reasons that lead to a drop in stock prices below their initial placements, especially those that decrease from the moment they appear on the market.
One of the main reasons for such a decline is the emotional reaction of investors. When stock prices begin to fall or fail to hold at their proposed cost, investors start to feel fear and uncertainty, which leads to massive sell-offs and further price drops.
Additionally, some stocks may be overvalued at their initial placement due to initial investor interest or inadequate analysis. In this case, stock prices may start to fall after real data about the company and its perspectives begin to manifest.
It is important to note that changes in the global economy, politics, and news about the company can also have a significant impact on stock prices. Therefore, it is crucial for investors to monitor all aspects influencing the stock market and be ready for price corrections.
