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All of my knowledge about stocks and whatnot comes from lurking /biz/ for a few days.
Let's say that a stock costs 1 dollar and I buy 1 million of them, then the next day the stock goes upto 2 dollars and I sell them all. So that's it? I made a million dollars in profit? Is it really this simple? I'm definitely missing something here, right? Surely the real world is much more complicated than this?
Also, I want to learn all about finance, stocks, investing, etc. but since this board's sticky doesn't really have any learning resources can someone please recommend books, sites or ways to learn from and guide me in the right direction?
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>>1546621
No, that's it.
But here's the best part, you don't even have to take any responsibility for it. You see, if you give me the $1 million, and I invest it into a stock that turns to $3 instead of $2, you'll make 2 million in profit.
So send me a million and we can get this started.
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>>1546633
I'll need the money for the wire transfer which will be 5k.
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>>1546621
Except the stock isn't going to jump 100% in the next day.
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>the stock goes upto 2 dollars
The quoted stock price going up to $2 only means that at least one person was willing to pay $2 for at least 1 share. It does not mean there are buyers for all one million of your shares at that same price. The rest of the buyers in the market might only be willing to pay $1.50, or $1.25, or possibly even $0.75.
Go Google "bid/ask" and "stock order book" and do some reading.
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>>1546621
At a very high level this is correct.
A bit more in depth to further your knowledge:
Most brokers take a commission fee. For example some brokers (for institutional trades) charge flat 5 cents a share. Some have different pricing structures dependent on the price of the underlying security. Depending on what market you invest there may also be a market fee.
On top of that, buying 1 million shares would move the price of the stock up. For example Philip Morris (PM) has a daily average volume of just over 4M stocks. If you put a buy order for 1M stocks, it will account for 25% of average volume. This is a significant amount for a single trade.
Usually if you are partaking in a trade lot of this size you would go to your best broker, one that knows a lot of guys on the street and that can accomplish this order in block trades. This will ensure that you get the best possible volume weighted average price (VWAP).
It is also imperative to get an order of this size in pre-market as in the first 30min-1hr of market open their is a lot of volume
/rant
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