How does buying in affect the market value of a stock? If I buy in to a...

Fuzzy_Logic
Fuzzy_Logic

How does buying in affect the market value of a stock? If I buy in to a relatively stable stock like mgt was before John mcafee took over how do I know how much my purchase will affect that stock? I know that if you want to buy a stock priced at let's say 4 dollars per share the system looks for sellers at 4 dollars and if there are none it changes the price to 4.005 or 4.01 and keeps increasing the price until there is a seller. Or if I wanted to sell my 4 dollar stock it will look for buyers at 4 dollars and if there are none it will move the price down to 3.995 or 3.99 and will continue to decrease until someone buys a share. If I bought a million shares of mgt when it was 20 cents a share how much would it rise and would that rise be immediate? Is there a mathematical formula that is good at estimating how much you are affecting a stock based on the amount of capital being traded on a stock at any point in time?

Tldr: how do you estimate how the price of a stock will change based on your cash input? Buying or selling.

GoogleCat
GoogleCat

chances are u wont be trading enough volume to worry about the wake of ur own trade..
if someone had a sell order of 100 shares at 4 dollars, and the next lowest sell order was 100 shares at 4.50, and u wanted to buy 200 shares, then you would buy the first 100 shares for 4 dollars each and the next 100 shares for 4.50 each..
so u would have to pay 850 dollars for 200 shares but only 400 dollars for 100 shares

if u wanted to buy 60 percent of all the companies stock u might have to pay a large premium to someone who had an expensive sell order.

Playboyize
Playboyize

@GoogleCat
What if I tried to invest 1million in to mgt when it was 20 cents a share? You're telling me it wouldn't have any noticible alteration in the stock price at all? Even a half of a penny is noticible on robinhood. And how do I select what price I want to sell my stock for?

Dreamworx
Dreamworx

@Playboyize
it wouldn't have any noticible alteration in the stock price at all?
If enough people (totaling 1,000,000 shares) were willing to sell at .20, then no, it won't move.
Even better, if you tried to do it all at once, you'd get fucked, as the sellers disappeared and you were forced to pay a higher price per share.

Flameblow
Flameblow

The more important part, is finding how many shares there are, and how many additional ones are issued. Additional ones will be at a different price. You can find these on stock websites, you divide the amount of shares from the Market Cap (Company value).

You can theoretically bring the price up to $100, Find a small company buy shares at 1 cent, put in a $100 sell and have someone buy it at that price. Now nobody would buy it or anything but, you just influenced the price by a couple orders of magnitude.The price would revert back to 1c, because that's what all the other trades would be naturally... Volume and time are important.

Lord_Tryzalot
Lord_Tryzalot

@Flameblow
have someone buy it at that price
Not possible.
If they put in a buy order, it will be executed at the lowest price. You can't purposely overpay for stock.

BinaryMan
BinaryMan

@Lord_Tryzalot
if there is no other volume, yes it is possible.This type of price change also happens in afterhours trading, ever see a several dollar change on a 20 share trade??

Need_TLC
Need_TLC

@BinaryMan
if there is no other volume
if we lived in make-believe land
btw, existence of an after hours market in a stock is due to high demand for said stock. Exactly the opposite of what you're describing in your fanciful scenario.

StonedTime
StonedTime

@Need_TLC
Whatever, I was just explaining the mechanics of it. Another theoretical would be that all the shares of a company are owned at $1, and if every owner went to put in a sell order for $30, your market order would fill at $30, regardless of how worthless the company is.
Afterhours trading is also commonly abused to paint the stock red or green on a small amount of shares, just to keep it looking good to novice investors.
Fuck you for saying it is not possible, I have actually set sells for 20% higher and people bought market (at my 1.20x) within a few minutes.The price displayed on most software is the last buy made, not the ask, so fuck you. It's not fanciful, its just other people's errors or excitement making me some money.

Fuzzy_Logic
Fuzzy_Logic

@StonedTime
@StonedTime
I was just explaining the mechanics of it
Yeah, the mechanics of an impossible scenario.
You now what else is possible? Guatemala could beat us in a war. All that would have to happen is for all of our troops to get simultaneous heart attacks.
Fuck you for saying it's not possible.

Ignoramus
Ignoramus

@Fuzzy_Logic
No, but I have do it before personally and there is nothing special about me. It was just on a low volume stock on the Canadian venture exchange.

Nude_Bikergirl
Nude_Bikergirl

@Ignoramus
Their market buy was 20% higher than the last trade because my sell was high. Sadly it was the only one. I almost felt bad, because I in a sense sprung a trap on them. If they did a limit buy it wouldnt have been filled so high a day or so later... Market buys fuck people over all the time.

Crazy_Nice
Crazy_Nice

@Ignoramus
Sure, I know what you mean.
I was lucky and bought Apple for practically nothing yesterday. I picked just the right moment when only one guy was selling, and put in a buy order at $8.

Bidwell
Bidwell

@Fuzzy_Logic
To OP, the question you are asking is a bit tough, because we would need to know the market cap of MGT back then. A rough calculation would involve the market cap (company worth) from a month ago, divided by the amount of issued shares available at that time.
Now multiply that value by your million dollars.
That number will be the ratio of your shares against shares held by other people, and will reflect how much you would be able to push the stock up in a single sitting.
Again it is a rough calculation, and does not take into account for the buy/ask spread, available lots, outstanding warrants etc.
If you want to work on this type of thing, look at some finviz.com data, and bust out a calculator and some paper. Try and calculate the price to book value and some other metrics. Knowing what all values mean really will help you with seeing how a company is valued so you can make better choices.
Not saying MGT is the worst, but it has a weak track record, and anyone investing in it is probably doing it off hype, daily news excitement and "technical patterns" all fair methods to wind up fucking you three ways to sunday, if you are going in for anything other than speculation.

hairygrape
hairygrape

wait so wut happens if I funded $10 to my rh account and purchased 2 shares of MGT? Tomorrow when it opens is it possible that I will not be able to buy 2 shares if it were to jump in price because of insufficient funds?

pic is me

Techpill
Techpill

@Crazy_Nice
Look at todays AAPL chart, see where it drops down from 95.50 to 87.50 in a single spike spike off 20 shares? Somebody bought those 20 shares at a 10% discount. You're just inexperienced to the point where you cannot realize your own incompetence.

Firespawn
Firespawn

@Techpill
see where it drops down from 95.50 to 87.50 in a single spike spike off 20 shares?
No, because you just made that up.
APPL never dropped below $94.37 today, including after hours.
Tell me more about my incompetence, mong.

Playboyize
Playboyize

@Firespawn
There it is you sore loser fucktard. Spike at 4:55 pm.

girlDog
girlDog

@Playboyize
makes claim about price, uses a free Google widget as proof
Good luck out there in the markets!

PackManBrainlure
PackManBrainlure

@girlDog
Even the official nasdaq feed. It definitely hit a low of 87.51 in the aftermarket. kys faggot you seem to be retarded. just imagine me fucking your dead grandparents before you go to bed you little poor bitch.

Need_TLC
Need_TLC

@PackManBrainlure
some dumbass put in a market sell order AH and because of lack of AH liquidity an algo bought the shares and immediately dumped them back at market price.

Soft_member
Soft_member

@Need_TLC
look at this butthurt user move his goal posts.

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