How does the announcement of a new product affect the stock price of that company’s shares?
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Our response:
There are many factors that can affect stock prices. Typically if a public company is launching a new product, they will file a news release on the System for Electronic Document Analysis & Retrieval (SEDAR). If the company suspects the new product will affect the price greatly, they will arrange a halt of their stock through the Investment Industry Regulatory Organization of Canada (IIROC) to allow the market to absorb the news, so that all investors have the same information when making investment decisions about their stock. Whether a new product will have an affect on the stock can be associated with other factors such as:
- The industry of the company.
- Investor sentiment about the new product.
- Interest rates
Speak to a financial representative for advice about the affect a new product might have about a specific company.