The demand side of a market is where those who are willing to buy stock will be found. The supply side of the market is where the sellers of stock will be found.
Demand side market failures can also occur when there is a glut of stock. This is when demand is greater than supply and it can create an oversupply. When this occurs, stocks are not available because the sellers are too busy buying stock. This may lead to an oversupply of stocks or even a crash.
The supply side of an asset is the main selling point for a purchase. That’s a very important market fact to understand. The demand side of an asset is where the sellers will be finding stocks that will buy stock. When a stock is found, it can be the seller’s own asset or sell it to another buyer.
Demand and supply are the two sides of an asset and an asset can either be demanded or supplied. Demand is the more obvious side of an asset. When a stock is called for because a large number of buyers have bought the stock and it is in demand, then the seller can take on the asset and sell it (or loan it to another party) and buy more stock. However, this method of selling is not usually profitable.
The fact is that demand and supply are two very different things. We call something “demand side” when the asset is being bought to get more buyers and other methods of selling are called “supply side”. When demand is high and supply is relatively small, we call it a “market failure”.
The problem is the market failure is often a result of a buyer not understanding the asset. Or, a buyer not understanding the risks associated with the asset. Or, both. It’s a very complex topic and as such I will be very brief. At one point in time the market was so small that the only way to get something you needed was to buy it. However, because the market was so small, it was easy to get the wrong price for something.
The demand for a product is often based on how much it costs to make. The market is designed to maximize profit by keeping as many people as possible from getting the wrong price for a particular item. However, when supply is relatively low, that same profit maximization mechanism can get it too cheap to sell.
There are a few different ways you can try to maximize profit in the market, but the easiest way is to buy cheap. If you’ve got a really awesome new home, I bet you don’t want to pay $300,000 for it. You’ll want to buy a house that you can afford, and I bet you’ll be able to get a house that you can afford that costs $100,000.
But of course, if demand is high, this can cause a market failure and you might end up in a home that you cant afford. A bad home can be difficult to sell to a buyer that doesn’t really need it. For example, I know some people that are in a desperate situation. They have a house that is just about to fall down and it is making them miserable. They are considering selling it but don’t know what they are going to do with it.
