Buyers, sellers and holders: three perspectives on today’s markets
In a financial assets market, one can classify participants into three broad categories
In any financial market, the key to understanding its dynamics, outlook and potential performance is to get a handle on the different types of participant and what drives them. In a financial assets market, one can classify participants into three broad categories: Buyers: They are buying assets in the hope that their price might increase. Sellers: They are selling assets in the belief the price of the asset will fall or that the risk associated with holding the asset has increased beyond what they consider reasonable. In some cases, assets might be sold to fund purchases seen as better options. Holders: These normally take the form of long-term investors who hold assets through the cycles and believe that short- and medium-term price fluctuations cannot be accurately predicted. In some cases, assets are held because of a lack of alternatives, not because of conviction in the asset itself. Using these descriptions, let’s look at who these people might be in today’s market, using US ...
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