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What Money Making Opportunities Did You Miss Out On? (Page 2)
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Clinically Insane
Join Date: Jun 2001
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Originally Posted by akent35
Company now does a stock split, and the per share price becomes $5. Those original 10 people now have 20 shares each (thus a total of 200 shares), but the total value is still $1000. Now, let's say 5 new people purchase 5 shares each. That of course means that 25 new shares are being purchased, for a total of $125. Assuming the original 10 stock holders do not sell any of their shares, the total shares in the company is now 225 (200 for the original 10 share holders, and 25 for the new share holders).
You are wrong. The scenario you are describing can only happen if there is an IPO for those additional 25 shares.
People can not just buy shares that don't exist. And companies can not just sell additional new shares w/o an IPO.
If nobody sells their existing shares, nobody can buy "new" shares.
You are profusely lacking basic understanding of the stock markets.
-t
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Banned
Join Date: Dec 2013
Location: Kent, Washington (Up in God's Country!)
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Originally Posted by turtle777
You are wrong. The scenario you are describing can only happen if there is an IPO for those additional 25 shares.
People can not just buy shares that don't exist. And companies can not just sell additional new shares w/o an IPO.
If nobody sells their existing shares, nobody can buy "new" shares.
You are profusely lacking basic understanding of the stock markets.
-t
What? I can't buy some shares of Apple stock right now? That makes no sense at all. But, if it's like the real estate market (must be a seller before one can buy a piece of real estate), then I stand corrected. But, not sure why a company would not want more share holders, especially after a stock split. The idea of having more money flowing into the company (and keeping existing money), and the possible resulting increase in buying activity and price per share, seems like a good way to raise capitol.
So, basically what you are saying is that if a company wants to keep a "rein" on the number of shares stock holders can have (without an IPO, which of course does not apply to an existing company that already has stock holders), then how do they make more money on the stock market?
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Clinically Insane
Join Date: Jun 2001
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Originally Posted by akent35
What? I can't buy some shares of Apple stock right now? That makes no sense at all. But, if it's like the real estate market (must be a seller before one can buy a piece of real estate), then I stand corrected.
Yes, that's exactly how it is. For every share bought, there must be a share sold by a current stock holder.
How does that not make sense ?
Did you think companies could willy nilly create & sell new shares based on market demand ?
Originally Posted by akent35
But, not sure why a company would not want more share holders, especially after a stock split. The idea of having more money flowing into the company (and keeping existing money), and the possible resulting increase in buying activity and price per share, seems like a good way to raise capitol.
Oh geez, where to begin.
Shareholder dilution is the main reason companies can't just issue more stock.
Adding new shares doesn't create any new value. If a company just issues new shares, the shares of the existing shareholders suddenly represent a smaller fraction of the company's assets and earnings power, a.k.a. Shareholder dilution. The stock market doesn't treat that lightly at all.
Originally Posted by akent35
So, basically what you are saying is that if a company wants to keep a "rein" on the number of shares stock holders can have (without an IPO, which of course does not apply to an existing company that already has stock holders), then how do they make more money on the stock market?
I'm not sure you understand the reason for going public.
Companies don't just "make money" issuing stock. Issuing stock is giving away ownership and future cashflows (from earnings-> dividends).
IPOs are a means of financing a company's future growth, just like issuing bonds.
There are consequences to issuing stocks (or bonds). Both stocks and bonds will be "repaid" over time. Bonds in full at the end of the duration, stocks over time through dividends.
-t
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Posting Junkie
Join Date: Apr 2007
Location: Iowa, how long can this be? Does it really ruin the left column spacing?
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Originally Posted by akent35
Simple enough for you, oh narrow minded one?
You should probably focus less on name calling and more on figuring out why you're totally wrong.
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Professional Poster
Join Date: Feb 2000
Location: Nashua NH, USA
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They can when they do an IPO say we're issuing 10 billion shares but only 5 billion of those are for sale in the IPO.
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Posting Junkie
Join Date: Mar 2004
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I think you're getting there Akent.
Short version, the company only raises money for itself when it issues new shares and this requires them to own enough of their own stock in order to issue new shares of it. In normal trading, only the shareholders can make money by buying them cheap and selling them when they go up or by sitting on them and collecting dividends if they prefer.
The only reasons the company really cares about the stock price is public confidence in their brand, to prevent the shareholders from wanting to interfere with the way the company is run or because the people running the company have shares themselves and may one day wish to sell them.
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I have plenty of more important things to do, if only I could bring myself to do them....
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Banned
Join Date: Dec 2013
Location: Kent, Washington (Up in God's Country!)
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Originally Posted by Laminar
You should probably focus less on name calling and more on figuring out why you're totally wrong.
Hey idiot, I already have done that! turtle777 provided a mature, educational explanation.
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Posting Junkie
Join Date: Apr 2007
Location: Iowa, how long can this be? Does it really ruin the left column spacing?
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I think his confusion comes from the fact that when you go to E*Trade or whatever and buy shares of a company, you're not buying those shares from the company, but from other shareholders. The company doesn't get a cut. I know this has been stated several times in several different ways, but he's clearly not following.
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Posting Junkie
Join Date: Apr 2007
Location: Iowa, how long can this be? Does it really ruin the left column spacing?
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Originally Posted by akent35
Hey idiot, I already have done that! turtle777 provided a mature, educational explanation.
Yes, like 6 times and you still don't get it.
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Banned
Join Date: Dec 2013
Location: Kent, Washington (Up in God's Country!)
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Originally Posted by Laminar
Yes, like 6 times and you still don't get it.
Hey "Stupid is as stupid does", I already stated CLEARLY above that I understand turte777's explanation.
Man, another person that can't read. Oops, he previously demonstrated that.
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Moderator
Join Date: Jun 2000
Location: inside 128, north of 90
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Clinically Insane
Join Date: Mar 2001
Location: yes
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That's because he lives in a toilet?
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Posting Junkie
Join Date: Apr 2007
Location: Iowa, how long can this be? Does it really ruin the left column spacing?
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Originally Posted by akent35
"Stupid is as stupid does"
I should really come up with an obnoxious catchphrase that I can post over and over again to deflect the fact that I look like a total moron.
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Clinically Insane
Join Date: Mar 2001
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Originally Posted by Laminar
I should really come up with an obnoxious catchphrase that I can post over and over again to deflect the fact that I look like a total moron.
Are you Turtle's brother?
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Clinically Insane
Join Date: Jun 2001
Location: Chicago, Bang! Bang!
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I think it's time for "kiss my grits" to make a return.
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Banned
Join Date: Dec 2013
Location: Kent, Washington (Up in God's Country!)
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Originally Posted by besson3c
That's because he lives in a toilet?
No, that's your home. Sure stinks around here when you leave your home, and come here and make uselsss remarks. Now scat!
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Banned
Join Date: Dec 2013
Location: Kent, Washington (Up in God's Country!)
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Originally Posted by Laminar
I should really come up with an obnoxious catchphrase that I can post over and over again to deflect the fact that I look like a total moron.
Yes, you are a total moron (you said it, not me). But, that actually goes along with you exhibiting "Stupid is as stupid does".
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Addicted to MacNN
Join Date: Feb 2008
Location: Standing on the shoulders of giants
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Originally Posted by akent35
Yes, you are a total moron (you said it, not me). But, that actually goes along with you exhibiting "Stupid is as stupid does".
And your sig says "Post maturely, and On Topic!". Bravo.
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Professional Poster
Join Date: Oct 2008
Location: UKland
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I have heard it said (I think it may have even been from the book The Great Gatsby) that the miracle of wall street is that for every person selling sharers there's always a buyer, until in the great crash, when suddenly there wasn't.
I guess the magic makes it seem like shares are infinitely available since you can always just buy them.
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This space for Hire! Reasonable rates. Reach an audience of literally dozens!
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Banned
Join Date: Dec 2013
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Originally Posted by mattyb
And your sig says "Post maturely, and On Topic!". Bravo.
That also means that I speak "down" to intended individuals.
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Professional Poster
Join Date: Feb 2000
Location: Nashua NH, USA
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Originally Posted by akent35
That also means that I speak "down" to intended individuals.
That's not a mature behavior.
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Forum Regular
Join Date: Apr 2014
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I knew that ban hammer was gonna go tap tap tap...
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If you have Ghosts, you have Everything!
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Clinically Insane
Join Date: Jun 2001
Location: planning a comeback !
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LOL, I hadn't even noticed until now.
-t
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