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I'm the wrong person to answer this but I'll give it a shot...
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1244
Posted by el gordo on 2008-10-11 12:43:53

In Reply to: Dumbest Question of them all...Explain the stock market to me. posted by Al Attles' Soul Train on 2008-10-11 12:25:18

Your $1000 dollars goes to the individual or institution selling the shares of eBay, plus you pay a fee/commission to the broker. For that $1K all you get in return are the shares of eBay, which are a stake in the ownership of the company. The shares themselves are worth only what you can sell them for. To put it a different way, the shares are only worth what someone else is willing to pay for them.

Any gains or losses are only on paper until the stock is actually bought or sold. It's all funny money until you cash out.

*aka undocumented lurker*

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