"Excuse me, in my ignorance, but why is there so much volume on a stock that is failing."
Denial is a very sad place to be on these OTC stocks. Ignoring facts to find a valid answer even though not valid in reality is a sure fire way to find justification when investing. And a guaranteed loss of your money.
Anyways, since you obviously don't know the answer to your own question, you need to question why you are even looking or investing in stocks.
Volume is based on price and pumped news and has ZERO to do with the company’s actual financials or share structure. People who are buying this stock will rarely if ever buy more than $500 worth.
IF you take each days dollar volume and divided it by the number of trades usually always averages out to $300 maybe a little more.
IF this ticker did stay at $.18 before they changed the authorized to 10 billion, no one would buy the stock. The current issued is about 9 billion and at $.18 would have made their market cap $1.62 Billion.
They had to lower the price and increase the shares to sell more shares cheap. It’s the OTC norm. And even if the price keeps going down, the company selling the stock always makes money regardless of the price.
They win you lose. That’s how this works.
I bet they add another 10 billion to the authorized and sell them for $.0005 and net another $5,000,000 then that will be the end of this scheme. The same ones telling people that it will go to $.02 are the same pumpers who said at $.18 get in now before they go to NASDAQ.
Remember before they added the 10 billion they sold the initial 200,000,000 for $.18 ($36,000,000) and guess what? THE MONEY never made it to the SGMD financials because SGMD did not sell the shares.
They traded the shares for debt being paid off (Maybe $20,000 maybe a little more for each 100,000,000 issued cert) so all the money you see traded each day does not go to SGMD.
Debt investors will pay $20,000 in SGMD debt and get the stock (maybe 100,000,000 with each $20,000 payment) once that is done the shares sold are not from SGMD or the CEO.
It's as if you invested in an antique store that has valuables and instead of making the store work and make sales you just take a $10,000 rare vase and sell it to the guy down the street for $200 and you put the $200 in your pocket.
Then the buyer sells it at auction and says it's from your store and they sell if for $20,000. You think that the store gets the money when the store sold it cheap and is no longer their property.
Same with Debt diluted stocks. They are sold to investors cheap who resell them to you cheap. The money you see traded each day does NOT go to SGMD!
If they paid $20,000 for 100,000,000 they gave the CEO $20,000 so they paid only $.0002 for the shares so they can sell them for $.001 all the way down to $.00021 and still make money.
And they keep getting 100,000,000 for each $20,000 they give the CEO with no limit. The CEO takes in $20,000 every few days and the shares are sold each day 100,000,000 or more or less. That is why you see so much volume and NO change in price yet.
As long as people pay $.001 they will hold the price like they did at $.18. When that gets to be too much they lower it to $.0005
They go back to the CEO and say $10,000 for 100,000,000 shares then $5000 for 100,000,000 and with each tranche they keep the price going lower and lower for one reason.
SO YOU DON’T SELL, except at a loss because only they want to sell and not have you competing with them for retail investors money.
You will never see this stock average out to $2000 because even though people want to believe in this stock they also know not to invest more then a few hundred bucks.
Anyone who invested more is just more money that will be lost and they know that.
The reason for the large volume has many answers. Some, who paid more, want to buy more to cost average.
Some do not even know they have had the shares added to their accounts that are managed.
And also because at this price many will feel it could go back to $.02 (which is will not) but they figure what the hell, a few hundred bucks to take a lotto risk.
The people buying this stock also have bought 100’s of other similar stocks that folded and they will continue to buy more stocks like this moving forward. Same low price same huge volume.
You will never see the investors in this stock buy a stock that is $1.00 per share that promised the same as this stock when they posted they will file to go to NASDAQ and people pumped it will ROCKET to $8.00 per share.
Any OTC that is cheap people will buy regardless of the float or if the company is a total scam. It’s not about fundamentals it’s about getting a boatload of shares cheap just in case it hits. (Like a slot machine)
If SGMD changed their name to WE WON’T WIN and YOU WILL LOSE ALL YOUR MONEY, Inc. And they added 1 trillion shares to the authorized allowing you to buy 10,000,000 shares for only $100! Everyone would do it just for the sake of the shares being so cheap and IF IF IF it hits $1 they make $10,000,000 on a $100 investment.
Lotto mentality! Buy a $1 ticket and a dream. These stocks are not different.
These same investors will buy into many of the same stocks over and over. They are similar to playing the penny slot machine so they can extend their play over time hoping sooner or later they hit the jackpot.
These investors will never take $10,000 ploy one hand of blackjack and in a matter of seconds its double or nothing. Playing the risk both ways will still lose only one sooner then the other.
They know investing on 100 tickers that 99 will fail and the 1% still won’t make it. But they believe that one will hit $1 and make up for all the losses on the other 99 but it never happens.
As long as people are told this may go back to $.02 from $.001 they will buy 100,000 shares for $100 just in case they do go to $.02 and they turn $100 into $2,000.
$100 is no risk but they do know the outcome
