2006-09-27 01:01:58 · 8 answers · asked by Joyce 1 in Business & Finance ➔ Investing
not as long as it is not sold at a loss. The drop in price however does mean a loss in assets of the shareholder. But an actual loss, if any, does not occur until a sale.
2006-09-27 01:15:52 · answer #1 · answered by Anonymous · 0⤊ 1⤋
No. A positive spread between your buy/sell prices (i.e. the difference between the money you get when you sell your shares and the price you paid when you bought them) is what determines your loss. For instance, market makers always have a negative spread (for investors, at any given moment, buying a share is more expensive than selling one; for market makers the scenario is the opposite), that's why they always profit from their activity.
But you said "shareholders", not "investors", hence I suppose you don't mean that kind of loss. In general, the answer is, again, no. As a shareholder with a fixed position, your participation in the company remains fixed, and you don't lose anything in practice, unless it's the company that's losing (which may cause the share price to fall). This holds in general, but in some cases (e.g. when stock options awarded to the management are exercised), the share price falls as a consequence of "dilution": the number of shares is augmented in order to pay the managers, and your % of participation in the company declines.
2006-09-27 08:04:30 · answer #2 · answered by jarynth 2 · 0⤊ 2⤋
Not and yes.
It depends from how you look at it, or what are you talking about.
Some are right saying that the loss is not effective until you sell. That means looking at the question from the investor point of view.
But if you are talking about the effective value of the assets a person has at any point of time, yes.
If you present a report (i.e. to the bank) about what do you have, its value is lower than the day previous to the drop.
Both answers are right. You have to decide what was the meaning of your question...
2006-09-27 08:25:40 · answer #3 · answered by oldmarketeer 3 · 1⤊ 0⤋
Only if they sell below the price they paid. The market continues to rise and fall day by day which is the reason people are told to hang in there long term. If the drop is drastic and continues to decline, it may be time to bail out. Every stock like their business has good days and bad days. Because of fluctuations I like mutual funds where one stock's gain can compensate for another stock's fall.
2006-09-27 08:11:48 · answer #4 · answered by Anonymous · 0⤊ 1⤋
Obviously
2006-09-27 09:19:44 · answer #5 · answered by Ranto 7 · 0⤊ 0⤋
no its a loss of equity for the shareholders
2006-09-27 08:04:37 · answer #6 · answered by learningnewthings 4 · 1⤊ 0⤋
loss to everyone concerned.
2006-09-29 07:12:07 · answer #7 · answered by Anonymous · 0⤊ 0⤋
yes
2006-09-27 08:10:25 · answer #8 · answered by latitude58_8 2 · 1⤊ 0⤋