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Comment by tobyhinloopen | Hacker News Reader

The price goes up (or down) because someone bought a stock at that price... For every buy, there's one sell. For every win, there's a loss.

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A transaction is zero sum, the market is net positive. For the market to be zero sum, the market cap would have to be constant. If I buy something from someone for $1 then sell it to you for $2, I gained a dollar and you own a share that's worth $2.

> If I buy something from someone for $1 then sell it to you for $2, I gained a dollar and you own a share that's worth $2.

It's easy to see that this is nonsense: I could buy a widget from someone for $1, then turn around and sell it to my brother for $10000, does that really mean the widget is now magically worth $10000, and we doubled our collective holdings? No, what actually happened is that we together still have that same $10000, plus a worthless $1 widget.

Once again, the trade is within the context of a market and the market values the "widget", Apple Stock, Oz of gold or whatever as whatever people are willing to pay for it. That's how markets work. Individual Opinions are largely irrelevant.

You are 100% wrong, the market is not zero sum. A quick google search will educate you here.

Derivatives like options can be zero sum, options expire worthless.

I would have to agree beforehand that the share is worth $2, or else I wouldn't have bought it from you at that price. Somehow the share was already $2 before you sold it to me, but you got it for $1, how come? Your example is nonsensical.

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