THC Therapeutics Inc. (THCT)

[dinogreeves]

rward splits for stocks in the major exchanges are rare, but are still more common than reverse splits. Reverse splits are usually done for companies that are doing very poorly and are at risk for being delisted. One of the most common reasons companies are delisted is because they do not meet the minimum price requirements.

Forward splits are a way of providing more liquidity to a stock. Liquidity is a double-edged sword for traders. It can help the stock move more since there are more shares available to be transacted. Having too few shares can have the price move so fast that a few shares changing hands can kill any run. Too much liquidity can make a stock never move more than a few pennies at a time.

More liquidity is generally seen like a good thing. The same effect that can slow down an uptrend can slow down declines. Since most of the market goes long stocks, a stock that slowly uptrends will eventually be noticed. However, a stock that has little interest can see the share price slowly eaten away with occasional selling. The selling can be because of frustration, tax reasons, or fear. Over time these small taps downward can amount to a lot. The extra liquidity can help the company hold off that kind of slow bleeding when its slow on news.


So, my question is, which one does Mann really want? Lets see if he made the right move.