أنشئ حسابًا أو سجّل الدخول للانضمام إلى مجتمعك المهني.
They are two different terminologies,
The stock market refers to the collection of markets and exchanges where the issuing and trading of equities (stocks of publicly held companies), bonds and other sorts of securities takes place, either through formal exchanges or over-the-counter markets. Also known as the equity market, the stock market is one of the most vital components of a free-market economy, as it provides companies with access to capital in exchange for giving investors a slice of ownership.
The definition of Company strategy is a long term plan of action designed to achieve a particular goal or set of goals or objectives. Strategy is management's game plan for strengthening the performance of the enterprise. It states how business should be conducted to achieve the desired goals. Without a strategy management has no road map to guide them.
The relation between them, if the organization is part of the capital market (or the share holders) and developed a very effective business plan then this will have a positive impact on the company revenue which will have a high dividend and the share value will increase to achieve a high capital revenue.
Best Regards
Company Strategy is a plan and a process for the plan to take action and implement it. It involves the thinking and vision of the enterpreneurs, managers and CEO or owners of the company with a mission statetment for the company and risk taking on the management heads of the company.
Company stock is related to Strategy because it involves a plan to diversify company money and profit on the whole. The higher the market share the higher the position of the company in the market for the product or service offered. Market share is the basis of this operation and the company will profit if the share has a good profit margin. The sale of the share is put higher because the company will benefit from this deal and the shareholders will benefit too.
n the context of a single stock trading on a stock exchange, the volume is commonly reported as the number of shares that changed hands during a given day. ... The average volume of a security over a longer period of time is the total amount traded in that period, divided by the length of the period.
Strategic planning is a means of administering the formulation and implementation of strategy.
Strategic planning is analytical in nature and refers to formalized procedures to produce the data and analyses used as inputs for strategic thinking, which synthesizes the data resulting in the strategy. Strategic planning may also refer to control mechanisms used to implement the strategy once it is determined. In other words, strategic planning happens around the strategy formation process
An example to state this is shown for further understanding:
To illustrate, let’s look at the 1985 acquisition of General Foods by Philip Morris. General Foods traded for about $65 per share before the announcement of the R.J. Reynolds-Nabisco merger in June 1985. The merger generated a flurry of speculative interest in other major food companies, and the price of GF’s stock jumped to about $80 per share. In October, Philip Morris acquired the company for $120 per share.
These stock prices tell us a great deal about the market’s expectations for GF’s growth and profit-margin performance. Value Line’s long-term projections for General Foods in the summer of 1985 called for 6% sales growth and 7% operating profit margins. Coupled with estimates of investment requirements, tax rates, and cost of capital, these projections suggested that to justify the $65 per share price, General Foods would have to perform at those levels for eight years; thereafter, the company would invest at its cost of capital rate.
Exhibit I shows the various combinations of sales growth and operating profit margins needed to justify $65, $80, and $120 per share prices. It illustrates the trade-off between profit margins and sales growth. It also shows the difference between what the market expected in terms of growth and profitability before the merger (shown at the $65 share price) and the kinds of accomplishments GF would have to make to justify Philip Morris’s final payment price of $120 per share.
Exhibit I Signals on General Foods
For example, to justify a $65 per share price, GF would need to combine a 6% sales growth rate with a 6.78% operating profit margin (this combination is marked with an x). Interestingly, because GF invests at just above the cost of capital (or economic break-even point), it must raise its sales growth rate considerably to offset even a small decrease in operating profit margin. For example, if the margins decreased from 7% to 6.5%, the sales growth rate would have to go from 6% to 10% for the company’s value to remain at $65 per share.
Hence the relation is a means to achieve the company targets and get into the market share value within atleast 75 percent as to 100 percent as this will involve risk on the company capital.
An example of market share value:
let us see for the soap product and if a company buys a soap product, which will account for 40 percent and the others buy at 60 percent hence the market share value is 40 percent for the company on that soap product. company positioning for the product shows at 40%. and this is at low risk too.
I will second the opinion of Mr. Mohammed Yassin
Its a direct relation depending on the company's overall growth rate,if the company is multinational or international then the stock market is the utmost important factor in determining the company's strategy but for smaller companies doing domestic business at low level are not much related to the stock market
Thanks
.....................Follow>>>>>>>>>>
Thanks for invitation,
Agree with the answer of Mr. Mohammed Yassin.
company strategy aligns with the core business mission , and aims to act as a road map for sustained profitability, competitiveness and growth. Each strategy consists of short- and long-term plans outlining the methods and activities necessary to reach milestones and goals.also in stock market we can work in short - and long term that depend on strategy and plans to get a profits and reach to goals .
If a company has chosen to participate in stock markets, it must align it's strategy depending or basing on the available information about the stock market thus both past & present information is relevant. The company can adjust it's policies, trading activities & strategy after analysing such information and it can further predict future trends having such information at hand. For instance if the information available shows that the stock market isn't doing well, as a strategy, the company may opt to withdraw or delay it's investments in the stock market, it can also sell off it's shares as a strategy, it can also form strategic alliances to do better as a strategy, it can invest more if it predicts better performance in future etc
Thank for the invitation.
