Questions tagged [stock-markets]

The stock market is the community of individuals and corporations engaged in the buying and selling of shares of companies, called stocks, on the open market. Shares of stock are traded on a stock exchange and are tracked on indices such as the New York Stock Exchange and the Nasdaq.

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239
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21answers
79k views

Why isn't everybody rich?

This question came up after reading this question (stock market long term risks), in which it is re-iterated (as it has been many times on this site), that investing in the stock market, especially an ...
104
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7answers
54k views

Why is the stock market closed on the weekend?

It's all digital and done with computers these days, so why bother? Doesn't that just make the system less liquid, which is the opposite to one aim of having the stock market? Plus can't you just ...
69
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6answers
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At what point do index funds become unreliable?

Passively investing in exchange-traded funds that track some broad index is often recommended for private investors that don't have the time or expertise for active investment. In particular, index ...
67
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3answers
15k views

How did this day trader lose so much?

I recently read this article about a day trader that lost $100,000: A trader started a GoFundMe page to pay back $100,000 to E-Trade after a disastrous short Please explain this, because I can not ...
62
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4answers
132k views

How does a public company issue new shares without diluting the value held by existing shareholders?

When a public company issues new shares, the total number of shares traded in a secondary market goes up. Assuming there is no change in the fundamentals of the company and the profitability, I would ...
61
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5answers
18k views

Can a company block a specific person from buying its stock?

Say there is a very rich, very unpopular individual. This individual wishes to buy millions of dollars in stock in a company he or she thinks will be successful. The company, however, realizes that by ...
61
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10answers
12k views

If a broad long-term investment in the stock market is such a good deal, why don't banks do the “obvious” things?

There is a fundamental discrepancy or paradox that has been keeping myself, and many others, away from the stock market. Before I explain it, let me mention some selected popular questions on this ...
57
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16answers
18k views

Why can't we all agree to create a self-fulfilling prophecy with regards to the stock market?

To start off, I'm very green in my understanding about finance or the behavior of the stock market, but it does seem to me to be driven largely by fears & emotions of investors. If investors feel ...
57
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13answers
15k views

Why isn't the market dropping like a stone with all the bad news?

So I am reading and listening to the news, watching the numbers re Covid-19, listening to and reading apocalyptic accounts of the coming recession, hearing of record breaking unemployment reports and ...
49
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9answers
23k views

Investment strategy for Google: What did I do wrong?

Background: I started investing in stocks in October 2017. I have a $22K portfolio which is 60% software, 20% semiconductor, 10% healthcare, 10% others (retail, banking, etc.). It's tech-heavy ...
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9answers
11k views

Why do stock prices of retailers not surge during the holidays?

My six-year-old (!) son asked me this question and I didn't have an answer, so I told him I'd get back to him. He asked why people don't buy a large number of shares of a company before the holiday ...
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7answers
6k views

Why do stock exchanges have minimum share price requirements?

Most stock exchanges have rules about minimum share prices, below which a stock may be suspended or delisted from the exchange after a grace period. For example, the New York Stock Exchange requires a ...
36
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6answers
11k views

When selling stocks at a stop-loss price during a crash, who do I actually sell them to?

Consider a situation where a stock that was performing normally for a while crashes, say because news about a catastrophic development in the company become public. The share price drops from USD 85 ...
36
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4answers
9k views

What prevents stock prices from being artificially increased?

Let's say company FOO is trying to increase their $20 stock price. They agree to sell a share for $100. Of course, nobody buys. Now their buddy buys the share for $100. And maybe sells it back for ...
36
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6answers
10k views

Why would the stock market plunge on oil price crashes?

There are lots of news headlines on 3/9/2020 that read like this: "Saudi Oil Price Cut is a market shock" "Oil price war threatens widespread collateral damage" "low oil prices could ...
34
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3answers
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Why do most of the stock market's gains occur overnight? It has an overall loss during the daytime

I saw a tweet from the Chief Investment Strategist of Charles Schwab that said the following: Since 1993 from @bespokeinvest : Buying SPY at open & selling at close every day (ie, only holding it ...
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6answers
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Why should I care about short term stock market fluctuations?

I understand that the stock market is important. Even when people don't directly invest in it, they might still have pension savings which will be invested in the stock market. Returns over a 20–50 ...
29
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8answers
6k views

Can a casual investor effectively predict the direction of the stock market?

Is the stock market an efficient market, with assets whose direction of change in prices cannot be predicted by casual investors? The reason I'm asking this is because certain family members are ...
27
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5answers
11k views

Why do baby boomers have to sell 5% of their retirement accounts by the end of the year?

This article on Marketwatch quotes Raoul Pal of Goldman Sachs claiming that baby boomers have to sell 5% of their retirement accounts by the end of the year. Here is the specific passage: Pal says ...
27
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9answers
5k views

Is it wise to keep some savings in a cash account to protect against a long term market crash?

My wife and I have half our savings in a low risk diversified account (WealthFront - mostly bonds, some stocks). We have the other half in a high interest cash savings account (0.35% interest). Our ...
25
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1answer
3k views

Will the popularity of index funds cause a pricing bubble in the stocks that make up an index?

I can't help but notice the popularity of index mutual funds over actively managed funds. I think all the arguments are sound, but I have one worry: Index funds are run by buying the stocks listed in ...
24
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11answers
9k views

Why do people invest in the stock market when it is forecast that a drop should occur?

When reading different financial media, it is often mentioned that the stock market's drop in the spring of 2020 was not the actual bottom. Some believe that there will be a recovery close to the ...
24
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2answers
10k views

Did Johnson and Johnson really pay a 25% quarterly dividend in 1978?

I looked through some of the old Dow Jones stocks for a project I'm working on and found some inconsistency with JNJ stock. For a share price of $1.66 they appeared to pay $0.42 in quarterly dividends ...
24
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2answers
4k views

What happens to my shares if a company reverse splits its stock 10 to 1, but I own fewer than 10 shares? [duplicate]

Company A decides to do a reverse stock split and reduces the number of shares by, say 10 to 1. Before the reverse split I only owned 7 Stocks on that company. How will this reverse stock split ...
23
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11answers
9k views

What should I do with the stock I own if I anticipate there will be a recession?

I want to preface this with saying I am not asking if there will be a recession because I recognize that this is impossible to answer. I am asking if I feel there will be a recession, what should I ...
23
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3answers
3k views

Why would a financial institution prevent their clients from trading a specific security?

Ameritrade restricts trading of Gamestop: "In the interest of mitigating risk for our company and clients, we have put in place several restrictions on some transactions in $GME [GameStop], $AMC ...
22
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4answers
7k views

Did an additional $32 billion necessarily get invested into Amazon.com stock on October 26th, 2017?

The share price went up about 6.9%, and the market cap is $466 billion. Does that mean that that much new money had to have been invested after hours? Would it otherwise be possible for the stock ...
22
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9answers
5k views

Why do banks give small APR loans

I apologize if this has been asked before.... If you can reasonably expect to profit 6% or more from index funds and there are other ways to make a reasonably safe 6% on the stock market.... Why do ...
21
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10answers
5k views

Can you really always yield profit if you diversify and wait long enough?

It is a common assumption (and, as far as historical stock market data goes, also proven) that the stock market is always growing if you enlarge the time window long enough . In other words: The stock ...
20
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5answers
4k views

Who are the buyers and sellers that determine the bid and ask price?

It's commonly explained that the price of a stock is determined by supply and demand. You can see the bid price (highest price a buyer is willing to pay for the shares) and the ask price (lowest price ...
20
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2answers
5k views

Why do market-makers usually win against traders?

I heard that market-makers — like TD Ameritrade and Fidelity – usually make profits while traders do not, especially in foreign exchange. Why is that?
19
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9answers
8k views

Paradox - When to buy & when to sell a share?

Warren Buffett says buy when everyone is selling and sell when everyone is buying. Taking into consideration the support and resistance levels, everyone is selling near the resistance level and ...
19
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4answers
2k views

How to invest in stocks without using an intermediary like a broker? Can shares be bought direct?

I am looking to buy stocks but I would like to do so without a broker. From what I can tell, the exchanges are good ole boys clubs that require you know (or pay) someone in order to participate. Am I ...
18
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5answers
8k views

Why is AT&T's stock price declining, during the days that they announced the acquisition of Time Warner inc.?

Why does the stock price decline when a seemingly promising acquisition is announced & agreed on?
18
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1answer
3k views

What is the relationship between taxes and annual liquidation of the markets? [closed]

I read this article on MarketWatch where they outline Elizabeth Warren's plan to tax the wealthy: 2% tax on every dollar above $50 million in assets 6% tax on households crossing the $1 billion ...
16
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4answers
3k views

Universal Life Insurance or Term Life Insurance?

I am new to this website and asking for your help with a situation related to my personal finances. I have a friend who recently joined WFG (World Financial Group) and they were asking for me to join ...
16
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4answers
17k views

When would one actually want to use a market order instead of a limit order?

I'm new to investing. I'm looking into using an online discount broker to experiment with private trading. I'm in a position I don't mind losing money, but I don't want to lose more than I put in. ...
15
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2answers
5k views

Do “normal” shares in large companies pay equity, as well as profit?

If I buy shares in a big company like Intel or Microsoft I (can) receive a dividend. So these shares (can) pay "profit". However, if the company is bought, do i also receive a split of the "equity"/...
15
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7answers
15k views

Will the stock market continue to grow forever?

I am relatively new to investing. I understand that the stock market, in some sense, reflects what happens in the real economy. For example, if the U.S. economy grows, the stock market in the long ...
15
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1answer
953 views

Is a Low Orbit Gamma Cannon illegal?

The recent/current GameStop situation with r/WSB vs Wall Street reminds me in some ways of the Low Orbit Ion Cannon, a tool in the 2000s that 4chan/Anonymous used to DDoS sites using the home ...
14
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8answers
9k views

How can I make any sort of profit in day-trading if the price doesn't rise much after I buy stock?

How can I make 'big profit' in day trading if every stock I've seen only raises by around £10? I've actually found some companies that make me a £30 profit, is this what I need to go for? I'm just ...
14
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7answers
5k views

What's is the easiest way to purchase a stock and hold it [closed]

I'd like to invest some cash (just few thousands) that is currently sitting on my bank account. There are few companies I believe will significantly increase their value in the next years (let's say ...
14
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7answers
3k views

What happened when the dot com bubble burst?

The Wikipedia article on the dot-com bubble defines it as: a speculative bubble covering roughly 1995–2000 (with a climax on March 10, 2000 with the NASDAQ peaking at 5132.52 in intraday trading ...
14
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5answers
3k views

Does it make sense to buy an index ETF (e.g. S&P 500) when the index is at an all-time high?

I have some money I intend to invest over the next 3-4 years. An important chunk of my portfolio would be invested in a stock market index ETF such as one representing the S&P 500. Unfortunately, ...
14
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4answers
4k views

How is there a market for shares that get destroyed on sale?

After the spin-off of Hamilton Beach Brands from NACCO Industries I now own an equal number of A and B shares of Hamilton. Now here's the thing; the B shares have an interesting provision wherein they ...
13
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8answers
9k views

Why aren’t there more stock market prediction tools available?

Investing in stocks depends on multiple factors. In order to estimate the approximate best time can be done with experience, various calculations, etc. With the rise of Machine Learning, Deep Learning,...
13
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10answers
9k views

Does the stock market create any sort of value?

Sorry if the below seems like a conspiracy theory. It probably is, but I probably don't understand something. (This has bugged me to no end as long as I can remember.) Okay, so here is what I ...
13
votes
1answer
718 views

Why do stock markets end all trading for the day after a 20% fall?

The New York Stock Exchange just halted trading. This CNN entry explains the benchmarks they use to do that The New York Stock Exchange has a series of "circuit breakers" in place to calm ...
12
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3answers
17k views

If you own 1% of a company's stock, are you entitled to 1% of its assets?

Say you own 1% of company ABC's shares. If all of a sudden there is no more demand in the stock market for company ABC's stocks, and its share price dropped down to $0, can you claim 1% of company ABC'...
12
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5answers
328 views

What is the rationale behind stock markets retreating due to S&P having a negative outlook on the USA?

From a Bloomberg article published on 18/4/2011 Standard & Poor’s put a “negative” outlook on the AAA credit rating of the U.S., citing a “material risk” the nation’s leaders will fail to deal ...

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