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The Wikimedia Foundation's Terms of Use require that editors disclose their "employer, client, and affiliation" with respect to any paid contribution; see WP:PAID. For advice about reviewing paid contributions, see WP:COIRESPONSE. |
The first paragraph of the section Some perverse effects reads:
This is mostly or entirely unsubstantiated here. Who says it diverts resources? We should avoid phrases such as "it is said...". Which is the "earlier example"? How does a consumer "generate value", surely only producers can do this? If a speculator removes value when he gains on a transaction then surely he must provide value when he loses? And, of course, often (s)he will lose. If the producer chooses to sell to a speculator who are we to tell the producer he is not getting good value? What has the opinion of one man to do with this? What is "stock trade" and why is it a more "explicit example"? How do those holding for "dividend and capital gain" lose out to speculators?
Paul Beardsell 08:32, 21 Jan 2005 (UTC)
Damn speculators running up crude oil prices. That hardly makes the market "more efficient." —Preceding unsigned comment added by 72.146.209.110 ( talk) 03:01, 13 June 2008 (UTC)
I came here for information about speculation as in "Reasoning based on inconclusive evidence; conjecture or supposition", not about speculation as it applies to the finance world. How can we split this page into a separate page? mmj 08:42, 10 Feb 2005 (UTC)
I found the last couple of lines in this section a little confusing and sounding a little contradictory - what do others think about this. Just something I noticed while reading this wiki entry.
P1
P2
Why is "true worth" in scare quotes? - FrancisTyers 05:53, 14 February 2006 (UTC)
The following are unsourced: "Virtually all long term investors, even those who buy and hold for decades, may be classified as speculators" "A degree of speculation exists in every financial decision". They seem to use a definition of speculation that may not be universally accepted. Shawnc 10:24, 25 April 2006 (UTC)
Couldn't help but notice that the four market roles here earlier today were reduced to three by removing long- and short-term investing. Perhaps someone could explain why this was done. Jnelsonleith ( talk) 00:46, 7 October 2008 (UTC)
In the current version, the first paragraph contains an example (airlines and oil futures), together with a comment about why it may not in fact be applicable. This suggests to me that it should be replaced with a better example. — Alan ✉ 20:48, 24 October 2008 (UTC)
The idea on this page, that speculation means taking risk, and investment entails no risk, is total BS. A better definition is that investment encompasses all exchange of cash for longer term assets, and that speculation entails increasing risk, and hedging means decreasing risk. —Preceding unsigned comment added by 74.68.152.245 ( talk) 15:16, 15 November 2008 (UTC)
After adjusting the intro paragraph, I'm tempted to give this article a full re-organization.
Speculation is a difficult thing to define well. I think this article should present that feeling. Some of the best ways of defining it is by what it's not. I want to derive much of the work from the first chapter of Ben Graham's "The Intelligent Investor." into the first section. Judging from Amazon reviews, "Practical Speculation" isn't really worth buying if you have a financial background... NByz ( talk) 03:20, 29 March 2009 (UTC)
Suggested sections. Feel free to edit them directly with any ideas you might have.
Investment vs. Speculation
Actually the title of the first chapter in "The Intelligent Investor" it'll have some good discussion; A shorter version of the etymology section: it mostly lines up with a book called the "dictionary of word origins" that I have; Some examples that show the complexity of speculation vs. investing
Benefits of Speculation
Significant portions of "The economic benefits of speculation"; perhaps some specifics on techniques?
Pitfalls of Speculation
Significant portions of "Some side effects"; Need more information on "speculative bubbles" including examples from "Random Walk Down Wall Street" (like the tulip craze... I can't believe that isn't directly mentioned)
Government Policy — Preceding unsigned comment added by NByz ( talk • contribs) 03:19, 29 March 2009 (UTC)
I wonder if this shouldn't be moved to financial speculation, and the current Speculation (disambiguation) to speculation? Thoughts? -- Piotr Konieczny aka Prokonsul Piotrus| talk to me 21:51, 3 November 2011 (UTC)
{{request edit}}
Hi, I'd like to suggest some changes to this article to improve its content, particularly ensuring that it is factually correct and helps readers understand the topic better. While I'm not personally a financial expert, I have been working with and on behalf of the Managed Funds Association to prepare changes for this article. Due to my work for the MFA, I won't make any edits to this article myself, so I hope that other editors here will review the suggestions and make them if they are reasonable.
To start, I'd like to focus on the Regulating speculation section. Currently this section is not well-developed and includes some information that does not really belong here:
I'd like to suggest removing this information, which I think detracts from providing a good background on regulation of this type of investment. In its place, I propose adding the following wording that I have prepared, focusing on the current regulation in place:
References
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cite web}}
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ignored (|publisher=
suggested) (
help)
{{
cite web}}
: Unknown parameter |Publisher=
ignored (|publisher=
suggested) (
help)
Full <nowiki> version of the above
|
---|
Following passage of the [[Dodd-Frank Wall Street Reform and Consumer Protection Act]], the U.S., Commodity Futures Trading Commission (CFTC) has proposed regulations aimed at limiting speculation in futures markets by instituting position limits. The CFTC offers three basic elements for their regulatory framework: "the size (or levels) of the limits themselves; the exemptions from the limits (for example, hedged positions) and; the policy on aggregating accounts for purposes of applying the limits."<ref name="CFTC Limits">{{cite web |url=http://www.cftc.gov/IndustryOversight/MarketSurveillance/SpeculativeLimits/index.htm#P6_864 |title=Speculative Limits |Publisher=U.S. Commodity Futures Trading Commission |accessdate=21 August 2012}}</ref> The proposed position limits apply to 28 physical commodities traded in various exchanges across the U.S.<ref name="CFTC Position Limits">{{cite web |url=http://www.cftc.gov/PressRoom/PressReleases/pr6260-12 |title=CFTC Approves Notice of Proposed Rulemaking Regarding Regulations on Aggregation for Position Limits for Futures and Swaps|Publisher=U.S. Commodity Futures Trading Commission |accessdate=21 August 2012}}</ref>
|
If these changes seem neutral and acceptable to other editors, I hope you will make them. I have this page watchlisted so please feel free to reply here with any questions. Cheers, WWB Too ( Talk · COI) 17:30, 22 August 2012 (UTC)
{{request edit}}
Following my suggestions above, I have 4 related changes to propose to improve this article. Some of the current language in the
Investment vs. speculation section is misleading. Specifically, the following:
This wording is inaccurate, because although speculation is a distinct type of investment, it is still an investment. The way the current wording attempts to draw a contrast between the two concepts is misleading, and is contradicted by the following claim in the section that many long-term investors are in fact speculators:
What's more, the U.S. Commodity Futures Trading Commission defines a speculator as a particular type of investor or trader: "a trader who does not hedge, but who trades with the objective of achieving profits through the successful anticipation of price movements". Based on this quote and sources including this journal article, as I understand it, speculation should be viewed as an investment strategy, not something that can be identified by comparing with investment.
For this reason I'd like to suggest the 4 related changes as described:
References
{{
cite web}}
: Unknown parameter |Publisher=
ignored (|publisher=
suggested) (
help)
Nowiki version of proposed
|
---|
The view of what distinguishes investment from speculation and speculation from excessive speculation varies widely among pundits, legislators and academics. Some sources note that speculation is simply a higher risk form of investment. Others define speculation more narrowly as positions not characterized as hedging.<ref name=Szado>{{cite web |url=http://www.iijournals.com/doi/abs/10.3905/jai.2011.14.1.075 |title=Defining Speculation: The First Step toward a Rational Dialogue |last=Szado |first=Edward |year=2011 | work=The Journal of Alternative Investments |publisher=CAIA Association}}</ref> The U.S. Commodity Futures Trading Commission defines a speculator as "a trader who does not hedge, but who trades with the objective of achieving profits through the successful anticipation of price movements."<ref name=CFTC>{{cite web |url=http://www.cftc.gov/consumerprotection/educationcenter/cftcglossary/glossary_s |title=CFTC Glossary: A guide to the language of the futures industry |work=cftc.gov |publisher=Commodity Futures Trading Commission |accessdate=28 August 2012}}</ref> The agency emphasizes that speculators serve important market functions, but defines excessive speculation as harmful to the proper functioning of futures markets.<ref name=Staffreport>{{cite web |url=http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/cftcstaffreportonswapdealers09.pdf |title=Staff Report on Commodity Swap Dealers & Index Traders with Commission Recommendations |date=2008 |Publisher=U.S. Commodity Futures Trading Commission |accessdate=27 August 2012}}</ref>
|
If these seem like neutral and reasonable edits, I would appreciate if someone could make these for me. Cheers, WWB Too ( Talk · COI) 22:34, 12 September 2012 (UTC)
{{edit request}}
I have just one more suggestion to make to improve this article. The first paragraph of the
Economic bubbles subsection is poorly structured and entirely uncited, with multiple {{cite needed}} tags. Here's what it says now:
The information this paragraph presents is not wrong, but its wording is slightly misleading and could be significantly improved through careful editing and better attribution. I'd like to suggest replacing this with the following language, which is clearer and supported by reliable sources:
References
In a setting in which speculation is not possible, bubbles and crashes are observed. The results suggest that the departures from fundamental values are not caused by the lack of common knowledge of rationality leading to speculation, but rather by behavior that itself exhibits elements of irrationality.
{{
cite journal}}
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help); Unknown parameter |month=
ignored (
help)
{{
cite web}}
: Unknown parameter |access date=
ignored (|access-date=
suggested) (
help)
Nowiki version of proposed
|
---|
Speculation is often associated with [[economic bubble]]s. A bubble occurs when the price for an asset exceeds its intrinsic value by a significant margin.<ref name=Fleischer>{{cite web |url=http://books.google.com/books?id=1ZASrmGg6uIC&pg=PA40&lpg=PA40&dq=speculative+speculation+bubbles&source=bl&ots=Rb804w8L8x&sig=KfnsUXvuPcYgxBEAyDtbpDFBV8k&hl=en&sa=X&ei=yzI-ULyBGufE0AGDgAE&ved=0CDcQ6AEwAQ#v=onepage&q=speculative%20speculation%20bubbles&f=false |title=Booms, Bubbles, & Busts (The Global Marketplace) |last=Hollander |first=Barbara Gottfried |year=2011 |publisher=Heinemann Library |pages=40-41 |isbn=1432954776}}</ref> Not all bubbles occur because of speculation.<ref name="Lei">{{cite journal |doi=10.1111/1468-0262.00222 |last=Lei |first=Vivian |coauthors=Noussair, Charles N.; Plott, Charles R. |year=2001 |month=July|title=Nonspeculative Bubbles in Experimental Asset Markets: Lack of Common Knowledge of Rationality Vs. Actual Irrationality |journal=Econometrica |volume=69 |issue=4 |pages=831-859 |url=http://www.jstor.org/discover/10.2307/2692246?uid=3739256&uid=2129&uid=2&uid=70&uid=4&sid=21101009895483 |accessdate=29 August 2012 |quote=In a setting in which speculation is not possible, bubbles and crashes are observed. The results suggest that the departures from fundamental values are not caused by the lack of common knowledge of rationality leading to speculation, but rather by behavior that itself exhibits elements of irrationality.}}</ref> Speculative bubbles are characterized by rapid market expansion driven by word-of-mouth [[feedback loop]]s as initial rises in asset price attract new buyers and generate further inflation.<ref name=Rosser>{{cite web |url=http://books.google.com/books?id=mIluNwn5K8IC&printsec=frontcover&dq=From+Catastrophe+to+Chaos:+a+General+Theory+of+Economic+Discontinuities&source=bl&ots=sffi6g77RM&sig=ZfkG-r3F26azqUGzNkWznJRy_mc&hl=en&sa=X&ei=dEs-UJClHeP46QGGuYG4Cg&ved=0CC8Q6AEwAA#v=onepage&q&f=false |title=From Catastrophe to Chaos: A General Theory of Economic Discontinuities: Mathematics, Microeconomics, Macroeconomics, and Finance |last=Rosser |first=J. Barkley |year=2000 |page=107}}</ref> The creation of the bubble is followed by a precipitous collapse fueled by the same phenomenon.<ref name=Fleischer/><ref name=Shiller>{{cite web |url=http://www.project-syndicate.org/commentary/bubbles-without-markets |title=Bubbles without Markets |last=Shiller |first=Robert J. |date=23 July 2012 |access date=29 August 2012}}</ref> Speculative bubbles are essentially social epidemics whose contagion is mediated by the structure of the market.<ref name=Shiller/> Some economists link asset price movements within a bubble to fundamental economic factors such as cash flows and discount rates.<ref name=Siegel>{{cite journal |url=http://www.blackwellpublishing.com/pdf/EUFM_Siegel.pdf |title=What Is an Asset Price Bubble? An Operation Definition|last=Siegel|first=Journal |journal=European Financial Management |volume=9 | issue=1 |year=2003 |pages=11-24}}</ref>
|
If these changes seem neutral and acceptable, I hope someone else will make them. Cheers, WWB Too ( Talk · COI) 22:15, 13 September 2012 (UTC)
There is a type of land speculation that I think does not fit into this article and probably deserves its own article. I am thinking of the type in unsettled areas, such as along the frontier of the United States that was practiced by such companies as the Ohio Company and such individuals a William Penn. Buying unsettled land, developing it, sub-dividing it, advertising it, and selling off plots is not the same as speculating in oil in the 21st century. Good idea? What should it include? -- Bruce Hall ( talk) 03:14, 24 September 2012 (UTC)
speed trading >> Gold Fix Drawing Scrutiny Amid Knowledge Tied to Eruption >> Secret Currency Traders’ Club Devised Biggest Market’s Rates ( Lihaas ( talk) 15:19, 26 November 2013 (UTC)).
California City should be added to the "see also" section. Around 1958, people were buying and buying lots of this city in the Mojave Desert in California. This represents a form of speculation. — Preceding unsigned comment added by Hot Wheels 516 ( talk • contribs) 20:42, 10 June 2015 (UTC)
"speculation is any investment that increases the risk of your portfolio; hedging is any investment that decreases the risk of your portfolio". The problem with any other definition is that it will fail in some cases. For example, is selling calls on a high beta stock or commodity speculative? It is if you don't own the underlying asset; it is not if you do own the underlying asset. It's the rest of your portfolio that makes the difference, not the investment itself. Saying "covered call" does not describe the investment, it describes your portfolio. Now, I'm sure you'll immediately cite WP:SHITDONTNEEDTOMAKESENSEHERE I get it, I just thought I'd edumacate you so you have a chance of evaluating the language of the article on your own. (oh, and an asset is defined as something which will return value in the future, so it's silly to talk about speculation as an investment that hopes to return value, that's the definition of investment; investment is buying assets; anything else is expense.) 66.65.118.87 ( talk) 16:39, 12 June 2020 (UTC)
This article is rated C-class on Wikipedia's
content assessment scale. It is of interest to the following WikiProjects: | |||||||||||||||||||||
|
The Wikimedia Foundation's Terms of Use require that editors disclose their "employer, client, and affiliation" with respect to any paid contribution; see WP:PAID. For advice about reviewing paid contributions, see WP:COIRESPONSE. |
The first paragraph of the section Some perverse effects reads:
This is mostly or entirely unsubstantiated here. Who says it diverts resources? We should avoid phrases such as "it is said...". Which is the "earlier example"? How does a consumer "generate value", surely only producers can do this? If a speculator removes value when he gains on a transaction then surely he must provide value when he loses? And, of course, often (s)he will lose. If the producer chooses to sell to a speculator who are we to tell the producer he is not getting good value? What has the opinion of one man to do with this? What is "stock trade" and why is it a more "explicit example"? How do those holding for "dividend and capital gain" lose out to speculators?
Paul Beardsell 08:32, 21 Jan 2005 (UTC)
Damn speculators running up crude oil prices. That hardly makes the market "more efficient." —Preceding unsigned comment added by 72.146.209.110 ( talk) 03:01, 13 June 2008 (UTC)
I came here for information about speculation as in "Reasoning based on inconclusive evidence; conjecture or supposition", not about speculation as it applies to the finance world. How can we split this page into a separate page? mmj 08:42, 10 Feb 2005 (UTC)
I found the last couple of lines in this section a little confusing and sounding a little contradictory - what do others think about this. Just something I noticed while reading this wiki entry.
P1
P2
Why is "true worth" in scare quotes? - FrancisTyers 05:53, 14 February 2006 (UTC)
The following are unsourced: "Virtually all long term investors, even those who buy and hold for decades, may be classified as speculators" "A degree of speculation exists in every financial decision". They seem to use a definition of speculation that may not be universally accepted. Shawnc 10:24, 25 April 2006 (UTC)
Couldn't help but notice that the four market roles here earlier today were reduced to three by removing long- and short-term investing. Perhaps someone could explain why this was done. Jnelsonleith ( talk) 00:46, 7 October 2008 (UTC)
In the current version, the first paragraph contains an example (airlines and oil futures), together with a comment about why it may not in fact be applicable. This suggests to me that it should be replaced with a better example. — Alan ✉ 20:48, 24 October 2008 (UTC)
The idea on this page, that speculation means taking risk, and investment entails no risk, is total BS. A better definition is that investment encompasses all exchange of cash for longer term assets, and that speculation entails increasing risk, and hedging means decreasing risk. —Preceding unsigned comment added by 74.68.152.245 ( talk) 15:16, 15 November 2008 (UTC)
After adjusting the intro paragraph, I'm tempted to give this article a full re-organization.
Speculation is a difficult thing to define well. I think this article should present that feeling. Some of the best ways of defining it is by what it's not. I want to derive much of the work from the first chapter of Ben Graham's "The Intelligent Investor." into the first section. Judging from Amazon reviews, "Practical Speculation" isn't really worth buying if you have a financial background... NByz ( talk) 03:20, 29 March 2009 (UTC)
Suggested sections. Feel free to edit them directly with any ideas you might have.
Investment vs. Speculation
Actually the title of the first chapter in "The Intelligent Investor" it'll have some good discussion; A shorter version of the etymology section: it mostly lines up with a book called the "dictionary of word origins" that I have; Some examples that show the complexity of speculation vs. investing
Benefits of Speculation
Significant portions of "The economic benefits of speculation"; perhaps some specifics on techniques?
Pitfalls of Speculation
Significant portions of "Some side effects"; Need more information on "speculative bubbles" including examples from "Random Walk Down Wall Street" (like the tulip craze... I can't believe that isn't directly mentioned)
Government Policy — Preceding unsigned comment added by NByz ( talk • contribs) 03:19, 29 March 2009 (UTC)
I wonder if this shouldn't be moved to financial speculation, and the current Speculation (disambiguation) to speculation? Thoughts? -- Piotr Konieczny aka Prokonsul Piotrus| talk to me 21:51, 3 November 2011 (UTC)
{{request edit}}
Hi, I'd like to suggest some changes to this article to improve its content, particularly ensuring that it is factually correct and helps readers understand the topic better. While I'm not personally a financial expert, I have been working with and on behalf of the Managed Funds Association to prepare changes for this article. Due to my work for the MFA, I won't make any edits to this article myself, so I hope that other editors here will review the suggestions and make them if they are reasonable.
To start, I'd like to focus on the Regulating speculation section. Currently this section is not well-developed and includes some information that does not really belong here:
I'd like to suggest removing this information, which I think detracts from providing a good background on regulation of this type of investment. In its place, I propose adding the following wording that I have prepared, focusing on the current regulation in place:
References
{{
cite web}}
: Unknown parameter |Publisher=
ignored (|publisher=
suggested) (
help)
{{
cite web}}
: Unknown parameter |Publisher=
ignored (|publisher=
suggested) (
help)
Full <nowiki> version of the above
|
---|
Following passage of the [[Dodd-Frank Wall Street Reform and Consumer Protection Act]], the U.S., Commodity Futures Trading Commission (CFTC) has proposed regulations aimed at limiting speculation in futures markets by instituting position limits. The CFTC offers three basic elements for their regulatory framework: "the size (or levels) of the limits themselves; the exemptions from the limits (for example, hedged positions) and; the policy on aggregating accounts for purposes of applying the limits."<ref name="CFTC Limits">{{cite web |url=http://www.cftc.gov/IndustryOversight/MarketSurveillance/SpeculativeLimits/index.htm#P6_864 |title=Speculative Limits |Publisher=U.S. Commodity Futures Trading Commission |accessdate=21 August 2012}}</ref> The proposed position limits apply to 28 physical commodities traded in various exchanges across the U.S.<ref name="CFTC Position Limits">{{cite web |url=http://www.cftc.gov/PressRoom/PressReleases/pr6260-12 |title=CFTC Approves Notice of Proposed Rulemaking Regarding Regulations on Aggregation for Position Limits for Futures and Swaps|Publisher=U.S. Commodity Futures Trading Commission |accessdate=21 August 2012}}</ref>
|
If these changes seem neutral and acceptable to other editors, I hope you will make them. I have this page watchlisted so please feel free to reply here with any questions. Cheers, WWB Too ( Talk · COI) 17:30, 22 August 2012 (UTC)
{{request edit}}
Following my suggestions above, I have 4 related changes to propose to improve this article. Some of the current language in the
Investment vs. speculation section is misleading. Specifically, the following:
This wording is inaccurate, because although speculation is a distinct type of investment, it is still an investment. The way the current wording attempts to draw a contrast between the two concepts is misleading, and is contradicted by the following claim in the section that many long-term investors are in fact speculators:
What's more, the U.S. Commodity Futures Trading Commission defines a speculator as a particular type of investor or trader: "a trader who does not hedge, but who trades with the objective of achieving profits through the successful anticipation of price movements". Based on this quote and sources including this journal article, as I understand it, speculation should be viewed as an investment strategy, not something that can be identified by comparing with investment.
For this reason I'd like to suggest the 4 related changes as described:
References
{{
cite web}}
: Unknown parameter |Publisher=
ignored (|publisher=
suggested) (
help)
Nowiki version of proposed
|
---|
The view of what distinguishes investment from speculation and speculation from excessive speculation varies widely among pundits, legislators and academics. Some sources note that speculation is simply a higher risk form of investment. Others define speculation more narrowly as positions not characterized as hedging.<ref name=Szado>{{cite web |url=http://www.iijournals.com/doi/abs/10.3905/jai.2011.14.1.075 |title=Defining Speculation: The First Step toward a Rational Dialogue |last=Szado |first=Edward |year=2011 | work=The Journal of Alternative Investments |publisher=CAIA Association}}</ref> The U.S. Commodity Futures Trading Commission defines a speculator as "a trader who does not hedge, but who trades with the objective of achieving profits through the successful anticipation of price movements."<ref name=CFTC>{{cite web |url=http://www.cftc.gov/consumerprotection/educationcenter/cftcglossary/glossary_s |title=CFTC Glossary: A guide to the language of the futures industry |work=cftc.gov |publisher=Commodity Futures Trading Commission |accessdate=28 August 2012}}</ref> The agency emphasizes that speculators serve important market functions, but defines excessive speculation as harmful to the proper functioning of futures markets.<ref name=Staffreport>{{cite web |url=http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/cftcstaffreportonswapdealers09.pdf |title=Staff Report on Commodity Swap Dealers & Index Traders with Commission Recommendations |date=2008 |Publisher=U.S. Commodity Futures Trading Commission |accessdate=27 August 2012}}</ref>
|
If these seem like neutral and reasonable edits, I would appreciate if someone could make these for me. Cheers, WWB Too ( Talk · COI) 22:34, 12 September 2012 (UTC)
{{edit request}}
I have just one more suggestion to make to improve this article. The first paragraph of the
Economic bubbles subsection is poorly structured and entirely uncited, with multiple {{cite needed}} tags. Here's what it says now:
The information this paragraph presents is not wrong, but its wording is slightly misleading and could be significantly improved through careful editing and better attribution. I'd like to suggest replacing this with the following language, which is clearer and supported by reliable sources:
References
In a setting in which speculation is not possible, bubbles and crashes are observed. The results suggest that the departures from fundamental values are not caused by the lack of common knowledge of rationality leading to speculation, but rather by behavior that itself exhibits elements of irrationality.
{{
cite journal}}
: Unknown parameter |coauthors=
ignored (|author=
suggested) (
help); Unknown parameter |month=
ignored (
help)
{{
cite web}}
: Unknown parameter |access date=
ignored (|access-date=
suggested) (
help)
Nowiki version of proposed
|
---|
Speculation is often associated with [[economic bubble]]s. A bubble occurs when the price for an asset exceeds its intrinsic value by a significant margin.<ref name=Fleischer>{{cite web |url=http://books.google.com/books?id=1ZASrmGg6uIC&pg=PA40&lpg=PA40&dq=speculative+speculation+bubbles&source=bl&ots=Rb804w8L8x&sig=KfnsUXvuPcYgxBEAyDtbpDFBV8k&hl=en&sa=X&ei=yzI-ULyBGufE0AGDgAE&ved=0CDcQ6AEwAQ#v=onepage&q=speculative%20speculation%20bubbles&f=false |title=Booms, Bubbles, & Busts (The Global Marketplace) |last=Hollander |first=Barbara Gottfried |year=2011 |publisher=Heinemann Library |pages=40-41 |isbn=1432954776}}</ref> Not all bubbles occur because of speculation.<ref name="Lei">{{cite journal |doi=10.1111/1468-0262.00222 |last=Lei |first=Vivian |coauthors=Noussair, Charles N.; Plott, Charles R. |year=2001 |month=July|title=Nonspeculative Bubbles in Experimental Asset Markets: Lack of Common Knowledge of Rationality Vs. Actual Irrationality |journal=Econometrica |volume=69 |issue=4 |pages=831-859 |url=http://www.jstor.org/discover/10.2307/2692246?uid=3739256&uid=2129&uid=2&uid=70&uid=4&sid=21101009895483 |accessdate=29 August 2012 |quote=In a setting in which speculation is not possible, bubbles and crashes are observed. The results suggest that the departures from fundamental values are not caused by the lack of common knowledge of rationality leading to speculation, but rather by behavior that itself exhibits elements of irrationality.}}</ref> Speculative bubbles are characterized by rapid market expansion driven by word-of-mouth [[feedback loop]]s as initial rises in asset price attract new buyers and generate further inflation.<ref name=Rosser>{{cite web |url=http://books.google.com/books?id=mIluNwn5K8IC&printsec=frontcover&dq=From+Catastrophe+to+Chaos:+a+General+Theory+of+Economic+Discontinuities&source=bl&ots=sffi6g77RM&sig=ZfkG-r3F26azqUGzNkWznJRy_mc&hl=en&sa=X&ei=dEs-UJClHeP46QGGuYG4Cg&ved=0CC8Q6AEwAA#v=onepage&q&f=false |title=From Catastrophe to Chaos: A General Theory of Economic Discontinuities: Mathematics, Microeconomics, Macroeconomics, and Finance |last=Rosser |first=J. Barkley |year=2000 |page=107}}</ref> The creation of the bubble is followed by a precipitous collapse fueled by the same phenomenon.<ref name=Fleischer/><ref name=Shiller>{{cite web |url=http://www.project-syndicate.org/commentary/bubbles-without-markets |title=Bubbles without Markets |last=Shiller |first=Robert J. |date=23 July 2012 |access date=29 August 2012}}</ref> Speculative bubbles are essentially social epidemics whose contagion is mediated by the structure of the market.<ref name=Shiller/> Some economists link asset price movements within a bubble to fundamental economic factors such as cash flows and discount rates.<ref name=Siegel>{{cite journal |url=http://www.blackwellpublishing.com/pdf/EUFM_Siegel.pdf |title=What Is an Asset Price Bubble? An Operation Definition|last=Siegel|first=Journal |journal=European Financial Management |volume=9 | issue=1 |year=2003 |pages=11-24}}</ref>
|
If these changes seem neutral and acceptable, I hope someone else will make them. Cheers, WWB Too ( Talk · COI) 22:15, 13 September 2012 (UTC)
There is a type of land speculation that I think does not fit into this article and probably deserves its own article. I am thinking of the type in unsettled areas, such as along the frontier of the United States that was practiced by such companies as the Ohio Company and such individuals a William Penn. Buying unsettled land, developing it, sub-dividing it, advertising it, and selling off plots is not the same as speculating in oil in the 21st century. Good idea? What should it include? -- Bruce Hall ( talk) 03:14, 24 September 2012 (UTC)
speed trading >> Gold Fix Drawing Scrutiny Amid Knowledge Tied to Eruption >> Secret Currency Traders’ Club Devised Biggest Market’s Rates ( Lihaas ( talk) 15:19, 26 November 2013 (UTC)).
California City should be added to the "see also" section. Around 1958, people were buying and buying lots of this city in the Mojave Desert in California. This represents a form of speculation. — Preceding unsigned comment added by Hot Wheels 516 ( talk • contribs) 20:42, 10 June 2015 (UTC)
"speculation is any investment that increases the risk of your portfolio; hedging is any investment that decreases the risk of your portfolio". The problem with any other definition is that it will fail in some cases. For example, is selling calls on a high beta stock or commodity speculative? It is if you don't own the underlying asset; it is not if you do own the underlying asset. It's the rest of your portfolio that makes the difference, not the investment itself. Saying "covered call" does not describe the investment, it describes your portfolio. Now, I'm sure you'll immediately cite WP:SHITDONTNEEDTOMAKESENSEHERE I get it, I just thought I'd edumacate you so you have a chance of evaluating the language of the article on your own. (oh, and an asset is defined as something which will return value in the future, so it's silly to talk about speculation as an investment that hopes to return value, that's the definition of investment; investment is buying assets; anything else is expense.) 66.65.118.87 ( talk) 16:39, 12 June 2020 (UTC)