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Re: None

Saturday, 09/06/2025 12:16:18 AM

Saturday, September 06, 2025 12:16:18 AM

Post# of 2773
COMPLETELY NORMAL

When an OTC stock undergoes a reverse split, the first few trading sessions often look more volatile than usual. This doesn’t necessarily reflect real value changes... it’s more about the mechanics of how the market adjusts:

Market Makers Catching Up – Not all market makers update their systems immediately after a reverse split. Some may still be quoting or routing orders based on the old share count or pre-split price, creating mismatches.

Brokerage Platform Delays – Different trading platforms update at different speeds. While some reflect the new share structure right away, others may temporarily show incorrect balances or restrict trading, which can spook investors and impact liquidity.

Thin Liquidity / Price Swings – Because of these mismatches, volume often drops in the first few days, and even small trades can move the price dramatically. That’s why you might see a stock appear to be down 40–50% off its pre-split value in the short term, even though nothing fundamental has changed.

Normalization – As all market makers, clearing firms, and brokerages synchronize, the stock typically stabilizes and begins trading more in line with its true market value.
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