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The dollar price of a single unit of any tradable security-like thing is completely arbitrary: market cap, market depth and inherent value are all that really m
by cwkoss 6y ago
The dollar price of a single unit of any tradable security-like thing is completely arbitrary: market cap, market depth and inherent value are all that really matter.
Cheaper units are almost certainly not indicative of something being a better investment, I'd say the opposite is more often true: ex. penny stocks or any of the long-tail cryptocurrencies that trade at fractions of a penny.
- chihuahua 6y agoI mostly agree with what you're saying. But there is another aspect to this, based on the "greater fool" theory of investing. A lower-priced stock or cryptocurrency could be more likely to attract a larger number of unsophisticated buyers (Robinhood customers etc.) Especially for low-priced cryptocurrency, the marketing pitch of "it's like bitcoin for $1" could be very appealing, if you spread it on Reddit and other forums. So from a pump-and-dump perspective it may be more promising.
- enoughBadMath 6y agoIt's not like Bitcoin.
- sellyme 6y ago> Especially for low-priced cryptocurrency, the marketing pitch of "it's like bitcoin for $1" could be very appealing, if you spread it on Reddit and other forums. If you went back a decade in time while you were at it, maybe. But there's been such a relentless tide of cryptocurrency-related scams being spammed on forum boards since Bitcoin hit popular awareness that the only thing I can think of that would be less appealing is someone trying to flog discount pharmaceuticals.
- user-the-name 6y agoIn cryptocurrencies, "market cap" is basically a complete fiction, and totally nonsensical.