"Investing" vs owning stock

JHZR2

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Do you see a fundamental difference? Seems to me that investing is only occurring when Im bringing fresh money to acquire fresh shares of a company (which provide investment IN the company because of new cash on the table). If I buy them on the secondary market, Im "investing", sure, but it is in the fundamentals of a company based upon the prior sale of the stock and how good of use they did with the funds they got from the initial sale. Just seems a little different to me, and so Im trying to wrap my brain around. Its as if one way is more pure, and perhaps more deservant of high reward for the risk than another. Granted Im the stock buyer (secondary in reality), not the first type. Do you feel that there is a difference? Discuss.
 
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but the primary market/IPO funding couldn't exist as it is without a secondary market. Well, it could exist still as a privately held company--but that too is held by investors who also would like the option of being able to sell their share.
 
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I agree almost entirely, although as a shareholder, you are often offered new shares in a capital raising venture. Mucking around buying and selling isn't "generating wealth", but is a three card pea and shell game where someone "wins" at another's expense.
 
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My employer just issued a $30m stock issue to repay debt. I don't know if i will parttake. It was announced that the shares will be sold at a discount, day after the news it fell to the discounted value... Go figure. I like initial public offers, wanted to invest in queensland rail when they went public, kicking myself that i didn't. As to the original question, i would attach more of a personal sense of value to buying initial offers, but wether the outcomes vary i something i can't say. With an initial public offering you are at least in early not after the horse has bolted.
 
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crinkles, I think the point is whether investing in shares creates wealth/adds value to the economy. Here in Oz, putting in the start-up money for a new mine is creating something new, that may pay off. Buying BHP is a bet, educated or otherwise. Could reasonably argue that buying shares when Govt privatise is adding value, as they are either going to retire debt, build a school or two, or strip asbestos out of an existing structure. I wish they'd floated the state lottery rather than selling it outright.
 
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that would be one heck of a business. buying shares so an organisation can pay off debts they never should have had, well that's just nuts.
 
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Originally Posted By: Shannow
crinkles, I think the point is whether investing in shares creates wealth/adds value to the economy. Here in Oz, putting in the start-up money for a new mine is creating something new, that may pay off. Buying BHP is a bet, educated or otherwise. Could reasonably argue that buying shares when Govt privatise is adding value, as they are either going to retire debt, build a school or two, or strip asbestos out of an existing structure. I wish they'd floated the state lottery rather than selling it outright.
There are IPO's in companies that are just starting out - I like these initial investments, but other IPO's can be good too.
 
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