Sale of shares

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Querist : Anonymous

Querist : Anonymous (Querist)

22 November 2011 Hello

i know economics if i earned profit it is another's mans loss he has to pay from his pocket.

now i want to know when persons making profit
by selling shares in stock market then who is paying it, i mean whose taking loss ?

please guide me .

CA SUMiT PATWARi

CA SUMiT PATWARi (Expert)
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23 November 2011 Let me explain you this by a simple example. We know, the transaction price is decided by the forces in the market. And each security has its fair value.
There is always some diff in this fair value and transaction price.
So if transaction value is 120Rs and fair value is 100Rs.
Amount gained by seller = 20Rs (amt realised in excess of fair value)
Amount lost by buyer = 20Rs (amt paid in excess of fair value)

so you can say that the gain of seller was paid by the buyer!!
and the amount of loss by one person = amount of gain to another person = 20rs in our example

Querist : Anonymous

Querist : Anonymous (Querist)

29 November 2011 IT MEANS IF I AM MAKING PROFITS BY SELLING SHARES IT IS ANOTHER MANS LOSS NA WHO PURCHASE SHARES AT HIGHER IN MARKET ?

Querist : Anonymous

Querist : Anonymous (Querist)

29 November 2011 IT MEANS IF I AM MAKING PROFITS BY SELLING SHARES IT IS ANOTHER MANS LOSS NA WHO PURCHASE SHARES AT HIGHER IN MARKET ?

Querist : Anonymous

Querist : Anonymous (Querist)

29 November 2011 It means if i makes profit it is another mans loss who buys the shares in open market at high price ?

ALLU

ALLU (Expert)
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31 December 2011 HI

LET ME EXPLAIN FROM BASICS THINGS HAPPENING IN LIFE ! AND WE CAN UNDERSTAND THE MARKETS

SUPPOSE A GUY LIKE ME HAVE FIELD IN "NOIDA"
15 YEARS BACK SOLD RS 10,000 /HECTAR...TO MR X

AND MR X HAS SOLD THIS TO ANOTHER PERSON MR Y AT RS 25,000 5 YEARS BACK

AND MR Y HAS SOD RS 1,00,000 TO MR B 2 YEARS BACK

SO WHAT WE CAN UNDESTAND THAT, ALL THESE GUYS BOUGHT AND SOLD ,,,,,,,HOIPING "NOIDA " WILL HAVE BRIGHT FUTURE

I YOU UNDERSTAND THIS BASIC , I WILL LET YOU KNOW WHAT IS HAPPENING IN MARKE

ALLU