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Posts: 322 | Thanked: 218 times | Joined on Feb 2012
#1764
Originally Posted by lma View Post
In other words, it is gambling, for everyone. If the price is random and governed by speculation you can't make rational decisions on it.
Not exactly. The price is what it is based on buy and sale. It's the same with real estate and gold for instance. Other things are based more solid on demand, food and energy, things that cannot be stored indefinitely or have small storage capacity.

It is more a question of why you are buying and selling stocks on an individual basis. Small time investors are typically gambling, unless they put their money in solid funds (not funds that are purely made for speculation though). But even then, you could say it is gambling, because the alternative is the bank.

If no one traded Nokia stocks, then the price would be unknown. Then if one person sold one single stock, the price of that would decide the price for all stocks. What is deciding the price right now, is that very few believe that they can buy stock now and sell it later with profit. That is, very few that trade with the 1-3% of the stocks that are available. The large investors are there because they believe Nokia will make profit, they aren't there to make profit by trading stocks.