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Must answer question: Worth to whom? Not every potential buyer will agree on the "worth" of X. Ultimately X is not worth anything unless and until X is sold.
by loginusername 11y ago
Must answer question: Worth to whom?
Not every potential buyer will agree on the "worth" of X.
Ultimately X is not worth anything unless and until X is sold.
Perhaps the tense is wrong.
Not what _is_ X worth, but what _will be_ the worth of X (when X is sold).
In the end, "worth" is "price paid" (by some buyer).
- ragnarok451 11y agoThat's true, but what I think they generally refer to is the price the market would pay (that is, the price/share where demand for a share will equal the supply). You are correct that "X is not worth anything unless and until X is sold" - that is why they are saying that IPOs may be lower than expected for these huge valuations - because the equilibrium market price is believed to be lower than the current valuations, priced by a small market of investors. According to the efficient market hypothesis stocks on the stock market will trade at their fair value (that's pretty disputed, but a good amount of respected people agree with it).