Hi all!
A professional race-car driver is asked to make 2 different "quarter-circle" turns on a racing track.
He completes them at the highest possible constant linear speed (he is well familiar with the car and the road so it's an easy task for him).
Turn 1: Radius is R1=20m. Linear...
Okay, so it's quite stunning! You don't actually get any money from owning this big chunk of the company's shares. Sure, you get plenty of respect and control over certain aspects of the company's inside politics. But, as my father would say, "you can't buy groceries with that".
If the company...
I see. I must follow that with another question. Even if I managed to get my hands around some 40% of the shares of a company, does that mean that I start making money from this ownership? Do I benefit something tangible from that ownership? (other then the good feeling I get from knowing I own...
Thanks for your input! I would like to clarify that my question (the first one, and it's variants later on) was not intended to state any form of concern or "beef" I have with the way the market operates. It really is an honest attempt to try and gap a hole in a very basic logical understanding...
If you claim that a share is a commodity (with which I don't disagree) then indeed the laws of supply and demand hold true. No question. But this is what I meant in earlier posts when I was going on about the IMMEDIATE or ACTUAL value of the share. For supply and demand to work as a system, the...
Ronnin, it doesn't matter if it's news or not. I can go to google finance and look up the financials myself. I can even talk to the CFO, if I know him! Even if I'm an all mighty prophet and I can with a 100% certainty predict the future revenue of a company:
The failure in the logical chain...
Could you please elaborate on that issue, and how it relates to stock valuation?
What is the rationale to think that a share, the price of which is determined by the buyers and sellers, would appreciate because of these good news?
That statement is the problem. The thing I can't understand is how come a share price, which is determined entirely buy buyers and sellers, is a representation of anything at all?
My question remains unanswered.. Why do you want to buy it's shares if the company is good? Why the price of the share will go up if the company is good long term (I'm not talking about whether the market will respond accordingly.. you just assume it will)? Where is the unwritten law that all...
So, like you said, the "price on the board" is only a reflection of the going rate for a share - a rate created by the speculation of the players. Correct? Well if that's the case then my point remains the same. Why does this speculation, more often then not, even has anything to do with the...
Too high/low for what? Too high compared to the price you think you'll be able to sell? Too low compared to the price you think you'll be able to buy later or from somebody else?
If you're buying something, where is the logical explanation for thinking that you'll be able to sell it later at a...
I must say that I'm very thankful for all the extra knowledge I'm getting here regarding shares and behavior in the stock market.
But I feel that somehow I managed to miss the point! The "holding for eternity" bit was an exaggeration, on purpose. It illustrates that, to the best of my...
Then my question is what did YOU gain by buying that Share.. what is your immediate interest in purchasing it? what will you get by owning it for all eternity? And then obviously another question is why did you agree to buy it at a price which reflects the "well being" or "potential" of some...
So, if I understand correctly, there is no other tangible value to owning a company's share (if you don't intend to sell it at a higher price). The only value is either the Dividend or the hope for future dividends? Maybe if you buy enough shares you get to vote on company policy issues, if you...
I am familiar with the various valuation methods employed by investors. I didn't know about the Q ratio, so thanks for that.
However you didn't answer my question.
What is the direct advantage of owning a share of the company if it's not paying dividends?
Shares are traded like a commodity on...