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Aren't they both obviously a zero sum game? There's a winner and a loser to a bet. If you buy a stock and it then rises, you profit and the seller has missed ou
by joosters 12y ago
Aren't they both obviously a zero sum game? There's a winner and a loser to a bet. If you buy a stock and it then rises, you profit and the seller has missed out. There's really no magical insight gained by the phrase 'zero sum game'.
- rahimnathwani 12y agoNo. The stock market isn't a closed system. The movements of capital and prices in the stock market impact capital allocation overall. Hence the arguments that HFTs that provide liquidity benefit the market because liquidity enables a larger pool of firms to seek listings or issue equity or debt.
- justincormack 12y agoYes thats basically true but if the stock market goes up overall it looks like net gains for everyone to many observers. It is not of course as the companies who issue the equity are technically in the short position.