Can we just admit that stocks are betting/a zero sum game

what about options.

what about leverage

What about bonds

see

>Can we just admit that stocks are betting/a zero sum game.

Zero Sum Game
ZERO SUM GAME
ZIRO SAM GEM !!!

Also it's totally possible for everyone to come out from stocks as a winner.
The condition for that is just for stocks to continue growing which is not guaranteed but as long as stock value keep growing everyone wins, as nobody ever sells with a loss

A stock isn't zero-sum since it's just like a random, physical object that can be sold/bought.

Say a dreidel is offered for 5 shekels. I think it's worth more than 5 shekels, so I buy it.

Something is revealed about the dreidel that makes no one offer more than 2 shekels. Assuming the price won't change, 3 shekels of value in the dreidel have been "destroyed".

3 shekels have left the "dreidel game" with the person I bought it from.

The reverse is true if something is revealed to make people offer 8 shekels for the dreidel. 3 shekels will be entering the dreidel game with him.

>This cannot happen when the stock market requires one person to willingly sell/buy and another person to willingly buy/sell
Poker is zero sum and all the participants are willing.

>a zero sum game.
Yes. The stock market is like a big balloon. You can keep blowing it up (money going in; higher market value) but you can only take out so much air as has been put in it. At no point does it inflate on its own, the only way for it to grow is by blowing air (money) into it.

Company uses 1 million in equipment to extract and sell 2 million dollars worth of coal.

Company price increases due to increased value of the company. Asking prices go up without any new money coming into the market as current shareholders rightfully demand more money for their claims on profits.

Where's the bubble faggot? Wheres the zero sum? Many companies are shit and the majority of trades are garbage but the market is not zero sum

Don't use pedantry like a reddit faggot saying coal is finite. Change it to asteroid mining and an infinite universe.

To expand upon this. Then where does the money to meet the asking price come from? It comes from newly printed money backed by an equal amount of aggregate supply which in an ideal case not inflate the currency and thus allowing more money to flow into the market. This may come from say wheat farmers increasing yield. Essentially more wheat and more coal are being traded than before. Money is used to measure the value. So therefore the newly printed money holds its value and everyone gets richer.

The fact that even though there's more humans today and quality of life and thus more value in the world is readily available makes the stock market obviously not zero sum

>be an autist
>cant proccess anything that deviates hard science
>Come across game theory and the term zero sum game.
>Get excited with your new label.
>Try to apply it to something that by definition cant be defined.
>get angry for some reason

One could say the then yes more money is needed to inflate the market however in the previous point with the asking prices going up, remember true market valuation went up without any new money coming in.

For all effective purposes stocks = money. If I buy $2000 of stocks, my net worth has not decreased by $2000

Willingness of the participants isn't relevant; the other user was wrong.

What makes stocks not a zero sum game is their ability to increase in value independent of the actions of buyers and sellers. This happens because there are actual companies underlying these stocks, and they often do good things or have good things happen to them (individually or through the economy as a whole). Historically, more good things happen to companies than bad things.

Poker is a zero sum game because, by contrast, no additional value is ever created except for the chips placed on the table by the participants. The house never spontaneously adds 10% to the pot..

Stocks aren't zero sum you idiot, look at the us stock market for the last 100 years.

Businesses create value. If you can generate a return greater than your cost of capital then you are creating value.

Put it this way: if you buy 10 pound worth of stock and sell it for 12 pounds, how much value have you created?

Willingness is not the sole criteria

You are not buying or selling in poker, you are gambling that you will win at a game of chance, therefore poker is zero sum.

You are not betting on the actual purchase of a stock. You are buying it for a set value and the other party is selling for the agreed upon value.

You may be gambling that the price ultimately rises or falls, but the purchase itself is not a gamble.

If you buy a stock for $1, then the seller gains $1 and you gain the stock. If the value of the stock rises 50% the next day, then the seller still has his $1 and you have $1.50.

The gain or loss has zero affect on the other party.

Potential gains or losses are irrelevant.

You don't really understand what a zero sum game is, let alone the mechanics that define it. That's ok, you get the right answer, just the wrong way.

Please explain where anything I said is different from what you said

Nightmare mode: Do it without splitting hairs

You keep giving examples of "win-win" scenarios as proof that stocks are not a zero sum game. Win-win is a side effect of a zero sum game, but not a necessary condition. I could give an example of win-lose or lose-lose in stocks and that doesn't change the explanation.

You have to look at the underlying mechanics to understand where the value creation comes from in the stock market. It's not from buyers or sellers, but from GDP growth, technology, laws & regulations, production efficiencies, transportation, etc., etc., etc.

Your original statement was:

>This cannot happen when the stock market requires one person to willingly sell/buy and another person to willingly buy/sell

and this is irrelevant, as I said. As I said, you got the right answer, you just didn't know why.

>Wow more people enter the bubble every year, must mean stock has intrinsic worth.

Just kill yourself now you communist retard

common shareholders directly pay for the dividends so the price goes down in tandem with the amount paid
preferreds, maybe no one does lose...

The government actually did things to help create this bubble. Look at stock markets pre 1980's, the total market cap went basically sideways over time, since the 1980s its been up up up except the sideways post 2000 big bubbles bursting

Psst OP... Did you know that the universe is zero sum? Wow, who knew?

This is so financially illiterate I don't even know where to start. Do you honestly think the only way stocks generate shareholder value is through price increase of the stock?

not really, while there is no free lunch from buying just before ex-dividend dates the fact that dividends are paid means there is additional profit being made beyond the buying and selling to and from other market participants - without dividends that would be a less than zero sum game

>stocks are a bubble

Do you not even understand what a stock is you dumbfuck?

Its part ownership of a company. That's why it has value

>so financially illiterate
Who knew stocks were taxed at 60%?
Wait til my butler hears about this.