|
![](/i/fill.gif) |
> And here I was thinking that the share price is just an arbitrary
> plucked out of thin air and fluctuating at random...
Err, no. Imagine something like ebay for selling company shares on
(remember there are a HUGE number of shares changing hand every second),
the share price is simply the price that the shares are being sold for
at that instant.
> So, like, if you own several million dollars worth of assets that you
> might potentially be able to sell, people aren't worried if you make a
> few thousand in losses? (Or rather, not *as* worried as if your assets
> were, say, £200...)
Exactly.
> It makes it look like all you have to do is *convince* people that if
> they invest enough money, "one day" you will start making a huge profit.
Yes, this is what happens when a company is "floated", you split
ownership of your company up into a fixed number of shares and ask the
public to buy them. You obviously get money for this, but you lose
ownership of some or all of your company. But if subsequently the share
price goes up, you get nothing extra (unless you are shareholder), it's
just the shareholders making money.
The better you can convince people you're going to make a huge profit,
the more money they will be likely to pay for a share of your company.
Post a reply to this message
|
![](/i/fill.gif) |