In stocks is there eventually a breaking point no matter how good you are IN HOW MUCH YOU CAN MAKE? (read de)?

Okay Here is my question the more money you invest the longer and harder it is too sell the stock right? So eventually say you have made 100 million dollars it would be hard to sell thta much equity QUICKLY RIGHT? HOW MUCH do you think someone can make and are THERE ANY BILLIONAIRES WHO HAVE MONEY FROM JUST STOCK.

Large blocks of stock are regularly traded. Sometimes, you break it up into smaller parcels and sell it over hours or days, or weeks, depending on how much you have to get rid of and what you are willing to signal to the market. Some of the largest shares trade $100,000,000 dollars a day. Most don't. You have to let your position go into the market in a way that wont cause the price you get to go down.

So you are correct in saying it might be difficult to liquidate such a position in a day. But if by quickly you mean a couple of weeks, and by company, you mean something liquid like Microsoft or Walmart, yes, you can liquidate that.

The other side of that is, if you have that much stock in one company, you probably have to report your planned sales to the SEC. Everyone will eventually know it's coming, and can adjust prices and volume accordingly to accomodate the trasaction that they have fair warning about.

That's a good point.

I think the breaking point depends on many factors: your age, your risk tolerance level, how good you are, etc.

Suppose, you start with $10K and double it? How many times can you repeat the process before you start socking some money away in real estate, bonds, etc.

I think you can keep going as long as you are not afraid of losing it all. The breaking point is when keeping it becomes more important than losing it. For one person it may be $500K, for another - $10M.

Ted Turner sold $700 Million in AOL; Kerkorian sold about $500 million in GM. So it can be done, they just can't jump in and out or buy these micro stocks that triple. Martha Stewart made a Billion off her IPO, and Jeff Bezos has a 40% stake in Amazon worth a couple bil.

Its basic supply and demand. Like any other product there has to be enough buyers to absorb the supply and support the price. If supply exceeds demand then price will drop. There may be enough buyers in the market to absorb a large number of shares. Or there may be a a group or a single buyer in a private transaction willing to buy all the shares offered. Also there are brokers that facilitate large block trades in the market.

Iâ€™m sure you heard this expression: â€œDonâ€™t put all your eggs in one basket.â€œ - havenâ€™t you?

Yes, there are billionaires who have money from just stock.

BUT one of the first rules I learned from one of my mentors was:
â€œUnder no circumstances and under any conditions, at any time, are you to have any more than ten [10%] percent of your money in any one position, at any one time."

Iâ€™m almost sure: multi-millionaires and billionaires were told that very same rule or given that very same advice by their financial advisors, accountants and anyone else who they relied on for financial advice and guidance.

I follow that rule and Iâ€™m sure they follow that rule as well. It makes perfect sense, doesnâ€™t it?

EXPLANATION: It doesn't make any difference how much money I'm writing about.
For this explanation I'll use One Million [$1,000,000.00] Dollars.
This represents 100%.

That person invests One Hundred Thousand [$100,000.00] Dollars in each of six [6] different companies @ 10% each: sub-total: $600,000.00.
This is 60%..

THEN that same person invests FIfty Thousand [$50,000.00] Dollars each [OR 5% each] in six [6] more companies.
This is a sub-total of Three Hundred Thousand {$300,000.00] Dollars.
This is 30%.

That person has Nine Hundred Thousand [$900,000.00] Dollars invested in twelve [12] companies.
This is a sub-total of 90%.

IF one, two or three of those companies that person has money invested in, "goes south" [that person's investment goes from the figure I mentioned to $0 on that day], what is the worst/most amount of money that investor loses? Without complicating matters, here's THE Answer: Three Hundred Thousand [$300,000.00] Dollars.
This is 30%

THAT STILL leaves Seven Hundred Thousand [$700,000.00] Dollars for that investor to re-invest on another day.
This is 70%.

My explanation is called "diversifying", "diversification" and/or "spreading the wealth".

AND WHAT IF ALL 12 companies "go south" at the same time and on that same day? I'm pretty sure the chances of that happening are slim to none - AND "slim" JUST left town.

What about that "extra" 100K? That's 10%. That's part of the Ten [10%] percent rule, too - isn't it? Yes, it is.

Thereâ€™s also this rule OR saying: â€œPut ALL your eggs in one basket AND watch THAT basket.â€ In all honesty, how many people do you think there are who do that? Iâ€™m sure there are millions who do the first part, BUT how many folks do you think do both parts?

Thank you for asking your question. I enjoyed taking the time to answer your question. You did a great job - not only for your information, but for every other person interested in reading my answer.

I wish you well!

VTY,
Ron B.

No it wouldnt be hard to sell it quickly because the market is liquid. IF someone else (another investor) wont buy the stock you are dumping, a market maker most likely will.

You can make alot. You can make money when the stock goes up, and the stock goes down. SO the tough job for you to accomplish is making long and short calls at the right time.

Warren Buffett took control of Berkshire Hathaway in the 1960's when the stock was selling for $10 a share. Now it is trading at over $110,000 per share. He's never split the stock, and he owns probably half the Berkshire Hathaway shares or so. Berkshire Hathaway has invested money over the years in a variety of stocks, but has pretty much stayed away from investing in Technology stocks. When asked why, he responded that he only invested in what he understood.

Warren Buffett is worth somewhere around $40 Billion or so. He recently said that he is donating his fortune to the Bill & Linda Gates Foundation.

Also, a lot of the newer Technology & internet companies have made their founders instant multi-millionaires and billionaires when they went public; Dell, Yahoo, Google to name a few.

Warren Buffett pretty much made his money from stocks and he's worth 40 billion (or was before he gave most of it away). There are limitations, I mean if you are investing 1 billion then you probably aren't even interested in most micro-caps. Not worth your time even if they are a great stock. Still, some companies have valuations of many billions so you've got to have alot of money before an investment in them would not be workable.

This is one billionaire from investing: Warren Buffett.

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