by Arthur Lipper
Investors buy something with the intent of selling it at some point in the future at a higher price. The belief is that in the passage of time the value of that purchased will increase.
Such an increase in value is possible if that purchased is art, jewelry, gems, antiques or other objects not requiring a change.
When an investor buys shares in a company the belief is the shares will be more valuable in the future due to the company being bigger and more profitable. However, if the purchase price is higher than the per share book value there is already a premium price/earning ratio being charged, which will have to be justified for there to be a profit for the investor.
