Stock market cash flow
Stock market cash flow
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Yuriy · External communityPost link
External question — Quantitative Finance Stack Exchange
Author: Yuriy
Original post: https://quant.stackexchange.com/questions/27609
License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/
Adaptation: HTML converted to plain text; contact email addresses removed.
I want to understand better cash flow of stock market and it's participants, but could not find any reasonable information online, hope more experienced people here could help.
Money IN flow:
(1)investors, hedge funds, investing banks, pension fund etc... anyone who invests/speculates on stock price
(2)companies paying dividends on their shares
(3)acquisition. When someone decides to buy public trading company they will return full cost to the market/shareholders.
(4)stock buyback
Money OUT flow:
(5)IPO. On time off outflow.
(6)share dilution.
(7)brokers, market makers, stock exchange support etc..
(8)speculative profit for category (1)
I hope I did not forget any, please let me know if I did.
Now we know there should be balance and inflow should be equal to outflow on long term.
The question here - is (2) - (4) enough to cover income for (5) - (8)?
I don't have statistical information but my guess would be no, does it mean that category (1) is constantly loosing money?
Thanks.
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Quoted from Forex.com.bd-Editorial External question — Quantitative Finance Stack Exchange Author: Yuriy Source score (net votes, not local likes): 1 Original post: https://quant.stackexchange.com/questions/27609 License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/ Adaptation: HTML converted to plain text; contact email addresses removed. I want to understand better cash flow of stock market and it's participants, but could not find any reasonable information online, hope more experienced people here could help. Money IN flow: (1)investors, hedge funds, investing banks, pension fund etc... anyone who invests/speculates on stock price (2)companies paying dividends on their shares (3)acquisition. When someone decides to buy public trading company they will return full cost to the market/shareholders. (4)stock buyback Money OUT flow: (5)IPO. On time off outflow. (6)share dilution. (7)brokers, market makers, stock exchange support etc.. (8)speculative profit for category (1) I hope I did not forget any, please let me know if I did. Now we know there should be balance and inflow should be equal to outflow on long term. The question here - is (2) - (4) enough to cover income for (5) - (8)? I don't have statistical information but my guess would be no, does it mean that category (1) is constantly loosing money? Thanks.
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