Originally Posted by JohnnyHammersticks:
So when someone buys IPO stock for $5/share, sells it to me for $10/share, I hold it for a few days and sell it to someone for $15 dollars/share, and that person holds it for a few years in a retirement account and sells when it hits $20, who's the loser? And you could insert "bitcoin" for "stock" and just change prices. And it doesn't have to be an IPO, just did that for simplicity.
In trading, the myth that for every winner there has to be a loser is just that - a myth.
Bitcoin has been more volatile than any mutual fund ever has been given the time period. The stock market also has a track record over a hundred years and has been shown to significantly increase one's worth over an extended period of time of investing.
When I knew people "investing" in Bitcoin last year, who were just shitty with their money, and had no idea about future financial planning I had to laugh. You could even see some of that on this board. You rarely meet someone throwing money at random stocks without a decent grasp of finances. Bitcoin is more or less gambling for many.
Originally Posted by JohnnyHammersticks:
So when someone buys IPO stock for $5/share, sells it to me for $10/share, I hold it for a few days and sell it to someone for $15 dollars/share, and that person holds it for a few years in a retirement account and sells when it hits $20, who's the loser? And you could insert "bitcoin" for "stock" and just change prices. And it doesn't have to be an IPO, just did that for simplicity.
In trading, the myth that for every winner there has to be a loser is just that - a myth.
Yes ,I've heard that many times. "well, someone was dumb enough to buy my shares at this price"
Floating shares are available shares for sale. If there were no floating shares then there would have to be a buyer and seller for every transaction.
Originally Posted by Hog's Gone Fishin:
Yes ,I've heard that many times. "well, someone was dumb enough to buy my shares at this price"
Floating shares are available shares for sale. If there were no floating shares then there would have to be a buyer and seller for every transaction.
Correct??
Kind of correct.
The float is the number of shares currently available for public trading, i.e. all shares not held by insiders. So for every "floating" share traded, there's a buyer and a seller. Sometimes those shares are held by market makers in order to maintain market liquidity, but technically those have a buyer and seller too, if you count the market makers as sellers/buyers.
Shares outstanding is the total number of shares the company has issued, including those held by insiders. So the number of shares outstanding is greater than the float 99.99% of the time - and the float can never be greater than the shares outstanding. Both the float and shares outstanding increase when a company issues more shares through an offering, which happens commonly when they need to raise money and have no revenues - like in the case of a biotech company developing a drug. The float can also increase when the lockout period ends for shares insiders hold.
Also keep in mind that the person who "was dumb enough to buy your shares" might have been a short-seller buying your shares to cover shares that they sold short. [Reply]
olout 08-26-2019, 10:22 AM
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