101–105 of 105 posts
Earlier quoted context omitted.
Mark Cuban is the lottery winner who thinks he's Jim Clark.
There were a lot of lottery winners who lost everything in the first tech bubble. Mark sold his company for billions then locked in his fortune using put and call options. Pretty smart if you ask me. Though, I do not agree with this article
Earlier quoted context omitted.
He isn't arguing firms are overvalued by a greater degree now relative to 1999. He's arguing that investments in private firms, which are far more popular now, are worse for small players due to their lack of liquidity. If things start going south in a private investment, a share holder may not be able to exit even at a large loss.
If things start going south in a public investment, a shareholder may not be able to exit that, either. The truth is, it's all about liquidity, and liquidity dries-up on the way down.
Well just get Cuban to tweet out that the stock is going to do good and it just might. Netflix was falling hard. Since Cuban's statement, it's gone up $133 or 39%. Coincidence?
Earlier quoted context omitted.
If things start going south in a public investment, a shareholder may not be able to exit that, either. The truth is, it's all about liquidity, and liquidity dries-up on the way down.
Sure they can except in the most extreme corner cases. You an contrive situations in which it's difficult to sell stock on the NYSE or NASDAQ, but it's basically always quick and easy (e.g., you can move $100K of FB stock in seconds using your phone during just about any market hour and often even outside of them). That is definitely not true of private markets, at least at the moment.
Earlier quoted context omitted.
Sure they can except in the most extreme corner cases. You an contrive situations in which it's difficult to sell stock on the NYSE or NASDAQ, but it's basically always quick and easy (e.g., you can move $100K of FB stock in seconds using your phone during just about any market hour and often even outside of them). That is definitely not true of private markets, at least at the moment.
Next time the market is in melt-down mode -- like it was just beginning to be last October -- watch how wide the spread gets. Sure, if you're somebody willing to take any price in a fire sale you can get out of anything.
My original reply was intended to point out that what was the top article comment at the time completely missed the point. Cuban is arguing that severe liquidity restraints are bad, especially so for small time investors. For scenarios like you describe, public exchanges aren't perfect either, but they are very, very good at facilitating near-instantaneous liquidity and they strictly dominate the current set of private crowd funding vehicles.