Sunday, October 13, 2013 10:06:35 AM
Authorized Shares and Dilution: Explained
The Strategy and Facts
Authorized Shares,
has no bearing on the price.
The "Shares Authorized",
is not used in any fundamental of financial calculation,
to determine company value.
OTC companies only have two things,
stock for sale and stories of progress.
The OTC process,
is to trade the stock sales,
and react to retails belief in the stories.
Dilution
What is Dilution?
Is it good, or bad ?
Dilution
is when the company moves shares from the AS (authorized shares) to the OS (outstanding shares) or tradeable inventory,
for cash investments in the company.
This means there are more shares
at the same market price
and reduces the size of the EPS.
It doesn't reduce the price or value of the stock.
But many pennylanders think it does.
Dilution
doesn't change price, it changes EPS.
Creating loss in company value, not stock value.
Hardly 1 in 1000 OTC companies have an EPS to effect.
So, dilution can't effect their company value in the first place.
Whats the value of no earnings, thus no EPS.
But, the value of more cash to a startup is huge!
Cash gives them the ability to attempt to grow.
Without the cash it can't.
So logic says, the retail herd should be happy about dilution.
After all, they want the company to grow don't they.
On the OTC, "dilution" is the best news one can hear !
Not only does it give the company a chance at growth,
it doesn't effect their EPS value one bit.
They have no EPS to effect.
Plus, every time VCs get there hands on large amounts of shares,
they buy a run, and we can trade for profits !
So, "dilution" is a win for the company,
a win for the Venture capital firm,
and a win for the educated pennyland trader,
on the OTC.
Stocks of many start-up companies,
bottom at the "Triple 000" price level,
before they begin their meteoric rise.
"Venture Capitalists" like to buy the shares of these companies at these low levels.
Anytime you have the financial means to buy a "Trip"
for 0.0001 to 0.0003,
do it !!
Try to buy 10,000,000 shares, and "trade" them.
Your cost,
to buy 10,000,000 shares of a stock at 0.0003,
is $3,000.
Keep 1,000,000 shares in your account at all times,
to sell at a later date,
just in case your stock turns out to be a high flier
months down the road.
The Trade
The Company and the Promoters "Plan the Trade".
All you need to do is "Trade their Plan".
It's that simple !!
The Strategy and Facts
Authorized Shares,
has no bearing on the price.
The "Shares Authorized",
is not used in any fundamental of financial calculation,
to determine company value.
OTC companies only have two things,
stock for sale and stories of progress.
The OTC process,
is to trade the stock sales,
and react to retails belief in the stories.
Dilution
What is Dilution?
Is it good, or bad ?
Dilution
is when the company moves shares from the AS (authorized shares) to the OS (outstanding shares) or tradeable inventory,
for cash investments in the company.
This means there are more shares
at the same market price
and reduces the size of the EPS.
It doesn't reduce the price or value of the stock.
But many pennylanders think it does.
Dilution
doesn't change price, it changes EPS.
Creating loss in company value, not stock value.
Hardly 1 in 1000 OTC companies have an EPS to effect.
So, dilution can't effect their company value in the first place.
Whats the value of no earnings, thus no EPS.
But, the value of more cash to a startup is huge!
Cash gives them the ability to attempt to grow.
Without the cash it can't.
So logic says, the retail herd should be happy about dilution.
After all, they want the company to grow don't they.
On the OTC, "dilution" is the best news one can hear !
Not only does it give the company a chance at growth,
it doesn't effect their EPS value one bit.
They have no EPS to effect.
Plus, every time VCs get there hands on large amounts of shares,
they buy a run, and we can trade for profits !
So, "dilution" is a win for the company,
a win for the Venture capital firm,
and a win for the educated pennyland trader,
on the OTC.
Stocks of many start-up companies,
bottom at the "Triple 000" price level,
before they begin their meteoric rise.
"Venture Capitalists" like to buy the shares of these companies at these low levels.
Anytime you have the financial means to buy a "Trip"
for 0.0001 to 0.0003,
do it !!
Try to buy 10,000,000 shares, and "trade" them.
Your cost,
to buy 10,000,000 shares of a stock at 0.0003,
is $3,000.
Keep 1,000,000 shares in your account at all times,
to sell at a later date,
just in case your stock turns out to be a high flier
months down the road.
The Trade
The Company and the Promoters "Plan the Trade".
All you need to do is "Trade their Plan".
It's that simple !!
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