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But if a company increases in value, shouldn't the value of your shares go up? I mean, isn't that the whole point of owning a percentage of a company?
by t0mbstone 11y ago
But if a company increases in value, shouldn't the value of your shares go up? I mean, isn't that the whole point of owning a percentage of a company?
- Renevith 11y agoThe increase in value only came from the new $500m in cash. That cash didn't come from the company's operations and it didn't come from you, so there's no reason to think that your shares would increase (or decrease) in value.
- redwood 11y agoNo because each share is worth a proportionally less chunk of the company. .. but don't get me wrong: speculators could certainly assume that it should mean that the stock price goes up and longer term it could enable the company to grow faster and in the end that could also cause its value per share to go up but immediately it doesn't really make sense for it to