4 ms·
I wouldn't consider buying a company's stock really as investing in that company, because 1) the company doesn't receive any benefit from your purchase except a
by Osiris 12y ago
I wouldn't consider buying a company's stock really as investing in that company, because 1) the company doesn't receive any benefit from your purchase except at IPO, and 2) your only incentive is to wait for the price to go up and sell.
Larger investors that buy up significant percentages of a company may be more invested, but again their goal is just for an increase in stock price, but for the long-term stability and growth as a company.
If a company is privately owned, the owners and employees have an incentive for the company to grow over the long term and focus on stability rather than quick wins and short-term financials.
- WalterBright 12y ago> the company doesn't receive any benefit from your purchase except at IPO This is incorrect: 1. corporations often issue more stock and sell it in order to raise working capital 2. employee compensation often comes in the form of stock in one way or another 3. a rising stock price means a company needn't pay out dividends in order to satisfy investors 4. without a rising stock, a company will find it much, much harder to attract investors, employees, borrow money, attract customers, etc. Few want to get on board with a loser company.