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Kearnstd
Space Elf
Premium
join:2002-01-22
Mullica Hill, NJ
kudos:1
reply to openbox9

Re: Promise of no more FIOS is merely convenient

And investors no longer want to wait out the long haul, they live purely by the quarter. if a company does not profit highly in a quarter they see it as a forever loss.
--
[65 Arcanist]Filan(High Elf) Zone: Broadband Reports

openbox9
Premium
join:2004-01-26
Germany
kudos:2
That is not true in an absolute sense. Many unprofitable growth companies have investors in for the "long haul" (what does that mean anyway?).


S_engineer
Premium
join:2007-05-16
Chicago, IL

1 recommendation

the average stock is held for 22 seconds...this is thanks to algorithmic trading...the same type that caused the flash crash. It's not about the company anymore...its all speculation....and that's what need to be addressed
--
"Thanks for the dance... and cut yourself a slice'a throat! "
- Curly (HOI POLLOI, 1935)

openbox9
Premium
join:2004-01-26
Germany
kudos:2
For a portion of the market, that is correct. For a bigger section of investors, that is not true at all. I don't have a problem with algorithmic trading per se, after all, it does add liquidity to the market. When I start having an issue is when algorithmic (or any other active trading scheme) begins to manipulate the market unfairly in favor of a minority versus the broader market, e.g. the "flash crash".

So back to your original question, what exactly is the issue with companies needing to please their investors?


tschmidt
Premium,MVM
join:2000-11-12
Milford, NH
kudos:9
Reviews:
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reply to S_engineer
said by S_engineer:

the average stock is held for 22 seconds...this is thanks to algorithmic trading...

Verizon policies aside I agree that short term stock market focus makes it very difficult for corporate management to make long term strategic decisions.

I like the idea of a stock transaction tax. It has minimal impact on long term holdings but will discourage short term trading. Equity purchases should be determined because you are comfortable with the long term prospect of the the company not what its stock will do in the next minute, hour or even the next quarter. Any company can be profitable for a quarter.

/tom