How come I hear "more buyers than sellers" and vice versa?
- Thread starter IronFist
- Start date
No, there are not the same number of buyers and sellers at any given point, and probably never has been.
These goddam gurus who don't know a damb thing about the markets always love to spout out that the number of buyers and sellers is equal. Alexander Elder comes to mind first, he wrote that crap in Trading for a Living.
The number of contracts being bought and sold is equal, the number of shares of stock being bought and sold is equal, the number of buyers and sellers is almost NEVER equal. Even a small trader like me has multiple people on the other sides of my trades.
Do you think that on the morning of April 3, 2000 there was an equal number of buyers and sellers in MSFT stock? No, there were thousands of more sellers than buyers.
These goddam gurus who don't know a damb thing about the markets always love to spout out that the number of buyers and sellers is equal. Alexander Elder comes to mind first, he wrote that crap in Trading for a Living.
The number of contracts being bought and sold is equal, the number of shares of stock being bought and sold is equal, the number of buyers and sellers is almost NEVER equal. Even a small trader like me has multiple people on the other sides of my trades.
Do you think that on the morning of April 3, 2000 there was an equal number of buyers and sellers in MSFT stock? No, there were thousands of more sellers than buyers.
You commonly call a trade a buy if the buyer is initiating the trade/taking liquidity/paying the spread and vice versa.
It's pretty easy if you think about it for a moment. It's true that every transaction has two parties - a buyer and a seller.
But imagine if (say) the newly elected president got a law passed that dropped gold to a dollar an ounce in the USA. Wow! What a great president, making gold cheap for everybody!
There'd be a whole lot of people ready to buy all the gold they could at a buck an ounce.
Problem is, there wouldn't be hardly anybody selling it for a measly dollar an ounce.
That's called way more buyers than sellers.
And it's also an excellent example of price controls.
But imagine if (say) the newly elected president got a law passed that dropped gold to a dollar an ounce in the USA. Wow! What a great president, making gold cheap for everybody!
There'd be a whole lot of people ready to buy all the gold they could at a buck an ounce.
Problem is, there wouldn't be hardly anybody selling it for a measly dollar an ounce.
That's called way more buyers than sellers.
And it's also an excellent example of price controls.
More buyers than sellers?
If Warren Buffett is buying (and I can bet he is) 1 million shares.
On the ohter side 1000 amateur traders are selling in panic 1000 shares each.
So 1 person is buying and 1000 people are selling, however one million shares are traded, both sold and bought at the same time.
