While I know some here may be in the top 10% of wealth in the US, and others can take advantage of this volatility to nibble around the edges, what is driver of the volatility if the top 10% are mainly trading among themselves?
Wealth Group Percentage of Stock Market Owned
Top 1% 50%
Top 0.1% 23.6%
Next 0.9% (99-99.9th percentile) 26.4%
90-99th percentile 37.2%
50-90th percentile 11.7%
Bottom 50% 1%
If the top 10% own 87% of the US stock market, what is the point of the daily volatility?
byu/whazmynameagin ininvesting
Posted by whazmynameagin
28 Comments
So they can consolidate.
Their greed is infinite
So they can keep the wealth on balance sheet and be happy!
Coke addicts need something to do all day and videogames are considered embarrassing.
You act like the people in the top echelon work together and aren’t trying to get each other’s money as well as your $20
100% of the stock market is owned by the top 100% of the population. What is the point in daily volatility if it’s just the top 100% trading amongst themselves?
Your question doesn’t really make sense. The stock market is just people trading with each other. The distribution of ownership isn’t particularly relevant when talking about volatility.
1 percent squeeze the 9 percent
Wallstreet is an entire industry of jobs just moving the epstein class’ money around trying to make money on the edges. Thats why volatility is actually going down overall. More money is held in retail accounts (ie robinhood) by people with real jobs who aren’t sitting around all day waiting to buy/sell.
Just like house sales, prices and volatility are controlled by the actual activity. 100 families may sit in their houses not selling for 30 years, but guess what sets the price of your house? Their 1 neighbor buying and selling.
So even if the rich are just happily sitting with trillions of dollars in the market, the millions being bought and sold daily set the prices.
Because the top 0.1% can manipulate things further for their advantage….those 9.9% are still pawns for them.
You act like the top 10% is a ridiculously large number. Many will be in the 10% and dont even know it because of their home value.
They are not trading among themselves or most are not.
If there are 100 shares of stock and I own 87 of them and just hold, the other people trading the 13 other shares are setting the price.
Basic ecomonic principals.
Demand and supply.
Low demand = lower price.
High demand = higher price.
What drives demand is a different question!
U know in the top 10 there is also top 10 and with in that there is top 10 and so on ?
People want to be absolutely bests not same class bests
That’s still like 13+ million people in the US.
Most of those people aren’t trading. They’re investing. I think the volatility comes because there are far fewer people in the trading pool. You’re kind of answering your own question. The most volatile market days are often low activity days. Like days before a holiday. We can see wild swings because there aren’t as many people willing to step in and buy or sell so the price fluctuations are much wider.
>if the top 10% are mainly trading among themselves
What makes you even think they are trading? If one has a $100M portfolio and owns $2M worth of NVDA, do you think they think about selling at the slightest volatility?
Do you understand how markets work? The current share price is only based on the last trade. It has nothing to do with who owns whatever shares.
Owning 87% of the market doesnt mean 87% of the market is trading on any given day. It just means 10% of the population owns 87% of outstanding shares.
Because the stock market is a giant mood ring for rich people.
While many comments about your question, I wonder what this data really represent.
For example, a considerable part is owned by foreign wealth and retirement funds. Are they considered single very wealthy entity? I.e. Norway Wealth Fund.
It’s not like they’re all VOO and chill. If you look at the big hedge funds – some focus on long positions, some focus on short, some do commodities, some distressed debt, fixed income. There are all kinds
There are the kinds that work on making a tiny bit profit front running volatility. It adds up. They know shit about where to be long in 2 years, they pay robinhood for trade data before it executes, they’re really good at just making money that way
So citadel makes money off daily volatility, Pershing square doesn’t
The top 10% have different investing needs/beliefs/strategies.
Also I think you’d be surprised how diverse the “top 10%” can be. A random dentist could very well have 7 figures in the market.
Think about it: you just need ONE person selling a stock at a 10% discount that the stock market will show prices dropped 10%.
Maybe he only sold 200 $ worth of stock, but the value of the company may have dropped by 1 billion.
Such is the world…
People split their money among many different funds and PE groups who all have their own strategies.
LOL imagine you were in the top 10 percent and so well off that you could do anything you wanted but you’re hanging out on Reddit
There are over 300 million Americans, so the top 10% are still over 30 million people. They aren’t a monolith.
What is the driver of volatility? Algorithmic trading bots, in large part.
Key word “market.”