Key insights
- The potential sale of a large block of shares (over 60 million) due to inheritance creates downward pressure on the stock price. While the share price may initially decline due to increased supply, the long-term impact depends on the company's fundamentals and market demand. Waiting for the price to drop after the shares are released might be a more prudent entry point, but carries the risk of the price not dropping as anticipated.
I hope the title somewhat makes sense sorry.
Back story, I know a person who has at least 60 million shares in a company and their deceased partner has just as many if not more. This person founded the company over 50 years ago and the company got listed on the stock exchange around 2001. When I first met them the share price was around $1.50 and recently it spiked to $30.
The person I know is currently 92 years old.
The question is would it make more sense to buy shares before they pass away before the market gets flooded with shares and they jump up in price or do you wait until the market is flooded with shares and they might be cheaper?
I’ve never invested in shares before and have been wondering what makes more sense.
And yes I should have bought shares for $1.50 back then.