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

Here it is VERY simple:

Do you think a stock will go up? Buy it

Do you think a stock will go down? Sell it

Thats it. Thats all trading is. People just disagree on which way a stock will go, and thats how transactions occur. One side thinks it will rise, the other thinks it will fall. They make a trade.