Example: if I bought $100 share of ABC company and tomorrow it’s $90, I get that I would incur a $10 loss if I tried to sell it, but I don’t understand what happens to the $10 difference ABC company still has from me.
Edit: okay so in this scenario:
1. i bought the share from the issuer
2. there is a downturn and the s&p index is down by 3,000 points
The first people to hear that the market is about to drop went ahead and cashed out their $100 share back from abc, however I was not lucky and my share is now worth $90. Wouldn’t ABC company have my $10? All the companies listed on the index, they get to keep the difference of the value of what the share was yesterday vs. today. Sure, the equity part of ABC company got smaller, but they still keep the $10 difference should everyone come back and cash out their shares?
In: Other
The money didn’t go anywhere. You bought something for a value, the value of the item went down. It’s no different than when you buy a car and as soon as you drive it off the lot, the VALUE went down.
Or when you buy food like milk, and even if you put it in the fridge, it will eventually go bad and be worthless. The value or worth of anything can go down, as well as up.
Shares only have the value that people and the market believe they do. They can go bad and their perceived value can go down.
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