Quote:
Originally Posted by noppenbd
When you own stocks or stock mutual funds, you do own something tangible. You own a piece of that particular company or companies.
|
I may be the biggest stock bull on the forum, but I have to respectfully disagree.
Stocks are quite intangible. As you point out you're staking a claim on a company's expected future earnings. That is all. Yes theoretically you're staking a claim on the company's assets, but in reality that's not the case. There are a lot of people in line to claim those assets before stockholders can get their hands on them. Practically speaking, if a company fails, a stockholder is left with absolutely nothing. (Not even a certificate anymore since everything is electronic.
)
Even if the perceived value of real estate drops to 0, you still have something left over. Land, building materials, etc.