Why would someone buy a share of stock for $945?

One reason might be that they think they can sell it tomorrow for $950.

A more common reason is that someone bought it an hour ago for $940.

Of course, this applies to more than equities. Why buy a Birkin bag for more than $25,000? Because someone else did.

The only thing worse than losing an auction by a few dollars is winning one by a lot.

All of this makes sense until it doesn’t. The “market” is very smart about any given moment in time, but not always particularly smart about the future.