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Stocks

Price Gap

A price gap refers to a phenomenon in the stock market where the opening price of a stock is significantly different from its closing price the previous day. This usually occurs when important news about the stock's value is announced after the market has closed. Factors such as positive or negative earnings reports or a buy-out can cause a gap in the stock's price. While stocks that gap at the open usually return to the previous close before moving again, this is not always the case. If the news is particularly impactful, such as projected higher earnings, the stock may continue to move without a pullback.

Related terms

Capital Gain or Loss

Understand the meaning and definition of Capital Gain or Loss in the context of stock market, trading, and investments.

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Dividend

Understand the meaning and definition of Dividend in the context of stock market, trading, and investments.

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Undervalued

Understand the meaning and definition of Undervalued in the context of stock market, trading, and investments.

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Issue

Understand the meaning and definition of Issue in the context of stock market, trading, and investments.

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Income Stock

Understand the meaning and definition of Income Stock in the context of stock market, trading, and investments.

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