AI
Thursday, July 10, 2008 9:57:36 AM
GP, would you at least admit your question just defied all logic? what you suggested is that DR would invite a crowd of institutional traders to participate in a private placement, and then they would all dump immediately for a loss.
why would they do such a thing?
in my original post, i advanced the theory that since they control a huge % of the current float they could do just the opposite. if they all decide to hold tight the stock will move higher with ease. and... for a minimal additional investment these bigger fish could quite literally chase retailers up the chart.
think about it for a moment. do the math: if they were to soak up an additional 35.5% of the float they could buy every single remaining share, and we know institutional investors already own a significant portion of the existing float, so the actually retail component is effectively much less than 35.5%.
i'm not saying they would buy out the smaller traders, because it's healthy for a stock to have a retail component -- it creates liquidity -- but it suffices to say they could write their own ticket by pushing the stock wherever they want it to go, and my hunch is they want it to go a lot higher.
why would they do such a thing?
in my original post, i advanced the theory that since they control a huge % of the current float they could do just the opposite. if they all decide to hold tight the stock will move higher with ease. and... for a minimal additional investment these bigger fish could quite literally chase retailers up the chart.
think about it for a moment. do the math: if they were to soak up an additional 35.5% of the float they could buy every single remaining share, and we know institutional investors already own a significant portion of the existing float, so the actually retail component is effectively much less than 35.5%.
i'm not saying they would buy out the smaller traders, because it's healthy for a stock to have a retail component -- it creates liquidity -- but it suffices to say they could write their own ticket by pushing the stock wherever they want it to go, and my hunch is they want it to go a lot higher.
