If people make money in stocks and crypto by buying low and selling high, who is buying the stocks from they are high, and why?

Question

Let’s just say for example, I bought a stock at $10. Then it goes up to $500

I can obviously make a profit, but why would someone buy it at such a high price?

Is it like the person who buys it at $500 is hoping that it will go up to $1000, then the person who buys it at $1000 hopes it will go up to $1500, and so on?

In: Economics

Answer 1

For stocks, they can keep going up in value because the economy grows., and this can go on more or less indefinitely.

With crypto technically the same thing could happen as long as people kept putting money into the market, but ultimately people realize it’s a pyramid scheme based on nothing with actual value, and cash out.