Hoek, you are correct we couldn't all sell at the same time the...

Hoek, you are correct we couldn't all sell at the same time the SP would plummet to zero if we tried. On bad news events you will see when a lot of holders of a stock all try to sell and the SP can plummet substantially, often up to the 20-50% range (eg. Bellamy's in December) and in exceptional circumstances more than 50%.

But other than that prices typically fluctuate because of daily imbalances in the level of supply & demand, i.e. what people are buying & selling on any given day.

So your question relates to whether people are trading the highs & lows, or are they holding for the longer term (i.e. through many highs & lows). The trade-offs are:

If trading the highs and lows, and you time your trades very well, you can make more profit over a longer period than someone else simply holding through that period (assuming the SP is trending up long term).

On the other hand, traders can miss out on the benefits of positive news events driving the price up suddenly, but be out of the market (unless shorting) if there are negative news events driving the price down suddenly.

In reality there are very few if any traders who are truly good enough to time the highs & lows consistently to actually make more than the long term shareholder over the longer term (anyone who claims they can you'd wanna see their bona fides imo). More usually, traders will trade a given stock a few times and move on to something else, exploiting opportunities in different sectors as sectors rotate in and out of favour.

There is no single path to success, just as there is no single path to failure. Each to their own. The point is the market can accommodate many different trading/investing styles and in fact if we all did the same thing as you imply, prices imo would be far more volatile, so we actually all benefit from the spectrum of trading/investing styles - imo.

To conclude my response, imagine as an extreme example if you planned to hold GXY for 3 years and waited patiently for the day 3 years from now when (for example) the price hits $2 and you finally decide to sell you holding according to your plan. Imagine the disappointment if say 50% of all holders had the same plan and all tried to sell that day - I suspect by the end of that day the price would be a lot lot less than $2 and you would be disappointed with your 3 year investment having possibly halved or more in one day.

Cheers, Sharks.