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Bartos

Share Price Increase?

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Dear All,

 

 

I'm writin a thesis about mobile trading platforms and I'm looking for an answer to this specific question:

 

Does an increase in trader's number make general share prices higher?

Let's say we have 1000 traders providing their capital for companies through exchanges. Common sense suggests for me that if the 1000 rises to 1500 there is going to be more capital "searching for investment opps" thus prices go up, and the value of company's increase without any additional effort. Let me know please if this logic is valid and how can I see numbers for this effect in reality.

 

Another question that came into my mind:

Let's say we're talking about the Indonesian market. The same example, but there're a lot's of new companies before their first IPO/share issuance. Does the 500 surplus trader provide a plus demand for shares that companies are able to get more money for one share?

 

 

I appreciate if you share your thoughts with me!

Thanks a lot!

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