GREY:MMNFQ - Post by User
Post by
Whatshisfaceon Aug 12, 2018 1:12pm
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Post# 28446587
GREAT! MEDMEN HAS A LOW FLOAT - HERE IS WHAT THAT MEANS...
GREAT! MEDMEN HAS A LOW FLOAT - HERE IS WHAT THAT MEANS...Low Float Stocks
Low float stocks tend to be more volitile in either direction (up or down) and the reason for this is because only a low percentage of the total shares are available for trading. (in MMEN's case, only 6% of the shares are currently available for purchase)
Why does this increase volitiliy?
In business we have all heard of supply and demand, and that same theory applies to any stock symbol. The less of something there is, the more people will be willing to pay for it. (If it's a thing of value to them)
In the stock market, a stock's value directly correlates with how many people want to buy that stock. If enough people want to buy, the price will increase. The opposite is true for a stock that is in low-demand. (ie. lot's of sellers)
When a low float is combined with either buying or selling, the price will move more quickly in the respective direction than a high float stock.
Lets use an example...
AAPL - everybody know this stock.
Friday's Close: $207.53
Percentage Change: -0.30% (AAPLE moved .3 of a percent on a volume of 22M)
Volume: 22,841,593
Outstanding Shares: 4.83 Billion
Float: 4.59 Billion (95% of shares are currently free-trading)
MMEN
Friday's Close: $4.08
Percentage Change: +3.55% MMEN moved 3.55% of a percent on a volume of 213,304)
Volume: 213,304
Outstanding Shares: 464.2 Million
Float: 28.8 Million (only 6% of shares are currently free-trading)
How do the numbers compare:
Percentage Change: MMEN Moved 11x More than AAPLE
Volume: MMEN's trading volume was 1% or AAPLE's
What does it all mean?
With 1% of AAPLE's volume, MMEN was able to move 11x more than AAPLE did.
If MMEN's volume was at 2 million per day... The stock would move 110x faster AAPLE stock.
We are only one BIG news relase away from that happening IMO. (ie New York Recreational)
When it happens MMEN will be a FOMO stock for many investors who are too nervous to get in today.
What happens when MMEN increases the Float by issuing new shares?
Well, similarly to APPLE (high float) as MMEN increases their float, it will help to stabilize the share price. This is a really good thing for the early investors. If MMEN can increase their share price before issuing new shares it will help stabilize the price at a higher level.
Eventually, this could be a monster $50 stock with a large float like AAPLE, which would be ideal becuase it will lock-in a lot of gains for the EARLY RISK TAKERS and less good for those who got in late to the game.
I really hope this helps, as I've seen some of you asking questions about what all of this means.
Good luck next week!