You may hear, when markets get “volatile,” that there are more sellers than buyers. Can that even happen? What does that phrase even mean? BTW, you hear it too in any market, including the real estate market.
The article below, “A Question of Equilibrium,” explains the basics of how buyers and sellers always agree on the price of exchange. What that price may be always changes. It’s the same in real estate markets too, if you stop and think about it, and in all markets where prices are determined by each and every buyer and seller pair.
I’ve written on this topic before … which seems to come up almost every time markets are “nervous.”
Note: Your email may not show the embedded part of this blog … please go to the blog to be able to read the complete post.
In the interest of disclosure: I do use Dimensional sub-managed SA Funds with most clients (not a fund requirement, but a business standardization decision I’ve made because of the evidence based approach. A short video (2:39) about Dimensional’s approach.
Analogies that explain the difference between investing and planning which many don’t realize are different:
- Investing is the fuel for your plan – it is not the plan itself.
- Investing are the cables that support your bridge which is the plan that gets you where you are to where you want to get to.
This blog is not a solicitation; simply an explanation of a basic philosophy and approach.