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To: ed who wrote (13880)1/18/1998 12:50:00 PM
From: Rick Slemmer  Read Replies (1) | Respond to of 97611
 
What are you talking about ? What I meant is every share sold there is one share bought. But for every one seller, there maybe 10 buyers. If the buyer and seller has to be one to one relation, then what if someone want to sell 100k shares while most buyers want to buy 1k shares, from your theory then the seller can never sell his shares.

ed, you keep forgetting about price.

For the absolute last time, your example consists of ten separate contracts: the seller and buyer #1; the seller and buyer #2; the seller and buyer #3; etc.

Now, all ten buyers may not like the initial price, at which point the seller lowers the price (becomes more aggressive because he wants to sell) until all ten buyers agree with it. That's why "all-or-none" orders aren't filled as quickly as orders that can be split.

Every transaction needs the following:

A buyer
A seller
A good or service
A mutually agreed price

Prices go up because the buyers are more aggressive and will pay more for the security.

Prices go down because the sellers are more aggressive and will accept less for the security.

If you need further clarification on Economics 101, please e-mail me.

RS