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To: 1Old Pro
A stock index fund, or mutual fund, is a continuous offering

Huh?

A company is authorized to issue and sell a certain number of shares of stock. An initial IPO sells shares to the general public. They don't keep on putting additional shares out there. That would have the effect of diluting earnings per share and that's the last thing a company wants to do! In fact, if you read the financial pages, a lot of companies - such as Apple - are actively buying shares back. They're cash rich and this is one way they can bump up earnings per share.

85 posted on 06/10/2015 12:03:23 PM PDT by ConstantSkeptic (Be careful about preconceptions)
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To: ConstantSkeptic

You said you bought index mutual funds and how does that benefit the economy. As the mutual fund grows they buy more stock in the underlying companies which creates buying pressure normally helping to increase the share price which helps the capitalization of the issuing company which in turn helps then in many business related ways.


87 posted on 06/10/2015 1:32:02 PM PDT by 1Old Pro
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