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Re: retiredtech post# 6871

Friday, 11/09/2012 11:17:09 AM

Friday, November 09, 2012 11:17:09 AM

Post# of 16191

ty ram for writing this, just thought everyone would like to know the difference again.......

Without naming posters , it seems some here need to be educated on DILUTION versus ACCUMULATION when it comes to stocks and investing. So here is a bit of help . and I havent seen any additional OS shares , otherwise post it as proof for us all to see...... Here is what STOCK DILUTION is A general term that results from the issue of additional common shares by a company. This increase in the number of shares outstanding can result from a primary market offering (including an initial public offering), employees exercising stock options, or by conversion of convertible bonds, preferred shares or warrants into stock. This dilution can shift fundamental positions of the stock such as ownership percentage, voting control, earnings per share, or the value of individual shares. A broader definition specifies dilution as any event that reduces an investor's stock price below the initial purchase price. http://bing.search.sympatico.ca/?q=Dilution&mkt=en-ca&setLang=en-CA oh and ACCUMULATION is here........ Understanding an Accumulation Day
Before getting into the importance and meaning of an accumulation day, it is important to look at the basic meaning of the actual word. Accumulation is based off of accumulate which means to add more to, gather, amass, etc. You accumulate a lot of things in life such as wealth, strength, friends, etc. In the stock market accumulation is used to describe the accumulation of shares by traders. The more people that buy, the more shares that are then purchased, which means more shares are accumulated. Piece of cake!

Things get even easier when you add the word "day" into the picture. It is exactly as it sounds: an accumulation day is when people amass or accumulate more shares at the ask (putting in buy orders) than at the bid (putting in sell orders) in a single day. The words have an extremely positive connotation with a stock, because heck if we are accumulating shares then we are constantly feeding buy orders into the market which drives the stock price up. The more buying we do, the more accumulating that is going on, and the more a stock price will rise.

Taking things one step further, a true accumulation day is one that has higher volume (or the amount of shares traded) than the day before, and the stock closed (finished the day) up overall. So, if stock XYZ closed yesterday at $13.50 a share with a total of 100,000 shares traded, and today closes as $14 a share with 300,000 shares traded, then we can say it was an accumulation day overall.


The saying, "the more the merrier" taken to a new level - Accumulation days are extremely effective when determining the overall direction (or trend) of a given stock. Applying basic understanding, if I know that the last two days have been accumulation days, well then I can safely guess that the stock is looking pretty strong (or bullish) overall! I don't want to be buying a stock that has had two out of the last three days be distribution days (the opposite of accumulation day). I want to be getting into stocks that are showing signs of people buying alot, not selling.

So, what we have then is that an accumulation day is any day when a stock closes higher than the day before and trades more shares (or volume) than the day prior. There is also what is called a heavy accumulation day, and this is a very big sign of a well performing stock. heavy simply means in this context very strong, and for the stock market means that the day not only closed up on higher volume, but with volume higher than the daily average.

Take this meaning word for word and look at it as it is. If we look at a stock and see that instead of the average 1,000 people make trades, 10,000 people make trades, AND the stock goes up 5%, well we know that there has been ALOT of buying (or accumulating) of shares. This is exactly what a heavy accumulation day represents. Simply put, the more accumulation days the better, and if they are heavy accumulation days, then strap on your seatbelt because you may have a big winner.
n was easy to google also .....




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