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If “everybody” continuously purchased the same stocks then those stocks would be precisely the ones you would want to buy The price of other stocks would plumm
by jncfhnb 2y ago
If “everybody” continuously purchased the same stocks then those stocks would be precisely the ones you would want to buy
The price of other stocks would plummet from low demand
- lovethevoid 2y agoStock price isn't based on demand, so no that wouldn't work the way you think it would. These same stocks would be overvalued, with no fundamentals backing them as everyone wouldn't be buying the products/services to create those fundamentals.
- jncfhnb 2y agoStock price is 100% based on demand and nothing else (well aside from new issuances or splits). Demand is ideally a function of fundamentals. The stock price being overvalued is irrelevant if “everyone” is buying it. This is a hyperbolic example but it plays out in the valuation of the sp500 when legions of folks just dump into an index fund.