Asset price reflects marginal supply and demand balance, Michael Green notes

Asset price reflects marginal supply and demand balance, Michael Green notes
Asset prices depend on supply and demand

Michael Green, chief strategist and portfolio manager at Simplify Asset Management, explains that the price of an asset is determined by the interaction of marginal supply and demand.

He notes that while various measures estimate value, only changes in internal company cash flows that generate external cash flows—such as dividends—can shift marginal supply or demand and act as a catalyst for price movement.

Green has recently highlighted that levered ETFs such as SOXL could contribute to volatility in the market, though he does not anticipate a collapse. He has also observed a decline in the number of seed stage companies. These comments add further context to his views on asset price movements and market structure.

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