22

It's not clear what level of answer you're looking for, so here is a much more basic answer. There are indeed many exchanges with many different prices. However, if you have noticed that you could make money by exchanging your BTC for USD, exchanging the USD for SEK, and then exchanging the SEK for slightly more BTC than you started with - then someone else ...


8

I won’t discuss the fundamental reasons why stock prices change (discussed in another answer), but the mechanics (roughly) work like this. (Real world is more complex, since there are multiple exchanges, and high frequency trading.) An exchange matches orders from buyers and sellers. The sensible way of making an order is to put a limit price on it. So you ...


8

Economic analysis always requires making some assumptions at some point. The assumptions that you make should try to fit reality the best that they can. Regarding your specific situation, there is a term in economics that might be helpful in describing what's going on: "Market Segmentation." This is a topic that is often studied in the asset ...


7

As mentioned in the other answer, the amount of money does not have to correspond to the total value of all assets in the economy. However, there is some correspondence that is not mentioned in the other answer so I will focus on that. First, there should always be enough money in the economy so people can carry all the transactions they want. If that is not ...


6

Disclaimer: There are a lot of interesting aspects to this question. Shareholder voting rights, control over the company, etc. are all interesting things to consider. Here, I only focus on a few parts of the question. Excess Volatility Claim: Are actual stock prices much too volatile to be explained by dividends? Is this evidence that the price of a stock ...


6

In stock market price is determined directly by supply and demand interacting in a way that is somewhat similar to haggling in traditional physical markets. Buyers will offer their bids for a stock (i.e. they will state for which price they are willing to buy a stock). At the same time sellers will have their ask price (i.e. they will state the price for ...


5

Increases in the money supply do not affect the real value of investments unless they lead to inflationary increases in the (quality-adjusted) prices of goods and services. Which this increase has not done. If you choose to measure the value of your investment as the proportion of the M1 money supply that it represents then sure, it has been devalued, but ...


5

tl;dr Yes, investing into stock market has positive impact on growth. First, before going any further, investing into stocks is from an economic perspective just a form of saving. Consequently, following the literature this answer will be repeatedly referring to saving in general. In economics, there are two main theories of economic growth. An exogenous ...


4

The total value of assets can exceed the total amount of cash or money in accounts. For example, suppose we live in an economy with exactly as much money as assets (say, 100 trillion). I then produce, at my home, a masterpiece of art from common materials, akin to the Mona Lisa. Appraisers and others assess it at 1 trillion dollars. There does not need to ...


4

The Fed funds rate is the rate at which commercial banks can borrow reserves on the overnight market (see this explanation at Investopedia). As such it affects all other interest rates banks charge since when they can borrow more cheaply they can also lend money cheaply to consumers. This affects among others also student loans (when they are provided by ...


4

There are not a lot of studies on this topic. There were studies in the 70s that would tend to disconfirm the idea of technical analysis as it was proposed at the time. The studies generated random sequences of numbers in a time series and had technical analysts then make decisions believing that the time series were real time series. They didn't detect ...


4

There's a bit of slackness in the phrasing of the question- you may have collected ideas or terms from informal sources (which is normal). Supply and demand refer to functions which can be rearranged to get either price as an output or quantity. Quantity Supplied = f(P, etc.) Quantity Demanded = f'(P, etc.) Included in that etc. is "Anticipation of ...


3

Yes, Fed sends all its profit including the ones it earns on government debt back to the treasury (this was already answered on this site here). Fed can create an unlimited amount of money by buying treasuries but not because of the interest payments but because of the debt itself. The interest payments themselves do not generate new money in this ...


3

Declaring bankruptcy is a step taken by companies to get protection from creditors. (They cannot seize collateral unilaterally, etc.) The company can still operate, within the legal framework, and with the obvious limitation that nobody wants to be owed money by the firm. Although equity often ends up worthless after all creditors have their claims settled, ...


3

Foreign Institutional Investors (FII) and Foreign Portfolio Investors (FPI) can and do invest in government securities as well. There may be restrictions of course leading to imperfect capital mobility. For example in India, FIIs/FPIs cannot hold more than 6% of outstanding stocks of securities. As interest rate increases (usually because of an external ...


3

Yes, price will decrease. If nobody wants to buy at lower prices, sell orders will push stock prices toward zero. This is possible in periods of financial turbulence, especially for companies that are very exposed to uncertainty and have do not have positive financial results to show to investors. If you are interested in exploring this topic, I suggest ...


3

I think asking people for a list here may lead to sample bias or a small sample set. If you want a more replicable approach, you could simply take the top influencers based on followers or retweets on social media platforms like Twitter, Stocktwits, etc.


3

Yes they do in in a several ways. The main ones are: Trading (not just of the people who actively manage the EFT but generally) helps price discovery. Price discovery is an important role of stock market. It is socially beneficial for companies to be appropriately priced given their fundamentals and all other avaiable information as that helps divert ...


3

If a sufficient fraction of market participants follow technical analysis it can work as self-fulfilling prophecy. If some pattern occurs that technical analysis interprets as signalling an imminent drop in prices these people will sell, which will cause the prices to actually drop. As is obvious from the above argument, whether an interpretation of the data ...


3

I typed "shareholders of record" into Google, and I got Stockholder of Record Also known as shareholder of record, record holder or owner, or registered holder, or owner. The stockholder whose name is listed on the company's books and records as the owner of shares as of a particular date (the record date). A stockholder of record holds stock in a ...


2

Yes, this has been done. Balashov and Nikiforov (2019) studied firms with similar tickers and found 25% had comovement in turnover and estimated 5% of turnover was due to investor confusion


2

If, as part quantitative easing, a central bank buys government bonds, it might affect prices of other assets positively via arbitrage and the so-called portfolio rebalancing effect. There are obviously several factors at play, but I focus on that one. If there is more demand for government bonds via QE, bond prices increase, and their yields fall. Assume ...


2

I will try to discuss this without veering too far into opinions. Firstly, it is entirely possible for investors to copy a portfolio that has its holdings public. Anecdotally, I’ve heard of retail investors doing exactly that. However, the question is whether another fund could market itself using that strategy. Saying that “we want to copy another fund’s ...


2

I disagree with the author's premise. The primary reason that options are exercised early is because of discount arbitrage (an ITM option trades below its intrinsic value) or there is a dividend arbitrage in an ITM put (the time premium is less than the dividend, NOT the call). No one with a lick of sense would exercise an option that has time premium ...


2

Efficient market hypothesis does not in itself predict that stock market returns will equalize among different stock markets so it should not really be part of the question (efficient market hypothesis only refers to informational efficiency of markets). Rather this is something that would be predicted by trade/international macro models that predict factor ...


2

The efficient market hypothesis allows for markets to grow. Markets usually grow thanks to economic growth, because more productive firms are more valuable. There is no economic law that says the market should grow. They are expected to grow because they historically grew for a long period and because there is no expectation that economic growth will stop ...


2

There’s already a longer answer, but two points of clarification. The Treasury would not “make money,” it just gets the interest back. The Fed purchases create settlement balances (“reserves”) for banks. (The Fed is a bank itself, those balances are the equivalent of private banks leaving deposits.) The Fed pays interest on those balances. When they need to ...


2

First there are some inaccuracies in your question. The central bank often goes to buy financial instruments that are riskier than government bonds (such as corporate bonds)- which is called "quantitative easing". This is simply not true large part of QE program consists of buying government bonds (treasury securities). Private bonds or other ...


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