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Microcap & Penny Stocks : JAWS Technologies - NASDAQ (NM):JAWZ
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To: Perchance N. who wrote (130)4/11/1998 1:52:00 PM
From: Moonglow  Read Replies (2) of 3086
 
Perchance,

Bruin gave you an excellent definition of float. I'll just expound a little on why I think that a low float tends to make a stock more volatile.

It all boils down to supply and demand. If there is a lot of demand, and yet few shares for the public to buy....then like any other valuable commodity that is in short supply...the price goes up higher than what it would if there was an ample supply.

And so when it finally corrects itself and goes back down to it's more true value, then it just seems to drop faster than would a stock with a lot of shares. For me, personally, I like a stock that has a low float.

Juanita
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