Article at a glance:

What makes your stock price go up and down

Imagine a world where CEOs could accurately predict how the stock market would react to earnings announcements and new strategies. Such information would be useful—to say the least—for making strategic and other decisions. While perfect foresight may never be attainable, executives can improve their predictive capabilities dramatically by replacing the ad hoc approach most of them now use with one that more rigorously digs into the things that make major investors tick.

The take-away

By taking a structured approach to identifying and understanding the finite number of investors who really affect the movement of a company's share price, the company can get deep insights into how such investors (and the market as a whole) will react to announcements—and more accurately predict the direction of its share price.