There is no such thing as a "share price" there are people who announce "I will sell for $x" and people who announce "I will buy for $y".
If you are managing a passive investment, you are obliged to buy at whatever the $x is (or sell at $y). And you will get a transaction fee anyway.
So the active investors have an incentive to hold out, driving up $x or driving down $y. The know the passive has to buy (or sell).
That's why the TSLA shares were ramping up in price earlier this year - TSLA was trying to get into the S&P. If they had made it, every passive manager would have been forced to buy TSLA - at any price! TSLA were not accepted so the speculators got back out again, crashing the price back down.
As more and more passive investment comes into the S&P the more detached from reality the index becomes. In a doom vortex scenario, it could drive every price down to zero or up to infinity.
Covid cases up, markets down is the best thing that could happen for democrats. Although it's maybe too late, we could see them literally try to tank the market and boost the number of cases in Pennsylvania, North Carolina and Michigan all the way to November 3rd.
These next two weeks are going to have levels of chaos that will make the first half of the year look like the appetizer.
Look fat, here's the deal .... (although this is no joke)
Around 50% of the share holdings in the US stock markets are passive investments - that is, they tell their stockbroker "Here's $X, buy me an amount of every share in the S&P". This is the highest the passive proportion has ever been.
There is no such thing as a "share price" there are people who announce "I will sell for $x" and people who announce "I will buy for $y".
If you are managing a passive investment, you are obliged to buy at whatever the $x is (or sell at $y). And you will get a transaction fee anyway.
So the active investors have an incentive to hold out, driving up $x or driving down $y. The know the passive has to buy (or sell).
That's why the TSLA shares were ramping up in price earlier this year - TSLA was trying to get into the S&P. If they had made it, every passive manager would have been forced to buy TSLA - at any price! TSLA were not accepted so the speculators got back out again, crashing the price back down.
As more and more passive investment comes into the S&P the more detached from reality the index becomes. In a doom vortex scenario, it could drive every price down to zero or up to infinity.
Covid cases up, markets down is the best thing that could happen for democrats. Although it's maybe too late, we could see them literally try to tank the market and boost the number of cases in Pennsylvania, North Carolina and Michigan all the way to November 3rd.
These next two weeks are going to have levels of chaos that will make the first half of the year look like the appetizer.
Keep in mind it's probably not covid cases that are up. They are now lumping the flu in the counts, which is the reason for the sudden spike.
Except because they are saying "Biden is up in the polls", they can't also say "markets fear a Trump re-election" (well, they can, and would).
Mass shooting this weekend blamed on pro-Trump white supremes
...
It's not about TSLA it's about the effects of passive investing
20% in one day will wake everybody up