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Microcap & Penny Stocks : Corporate Vision (CVIA)
CVIA 0.4800.0%Jun 30 5:00 PM EST

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To: Matt Brown who wrote (3829)4/17/1998 7:51:00 PM
From: TraderGreg  Read Replies (2) of 6654
 
Matt-In a forward split, people get excited because they know other people are more likely to buy the stock because it's half the price(I know that sounds crazy but it is still true). Moreover, under many circumstances, the doubling of shares reduces the available authorized for dilution. Of course, companies that do forward splits rarely dilute.

With reverse splits, the share price rises but because the shares outstanding reduces, the available authorized is higher, usually. And most companies that reverse big, just can't resist the temptation to seep/leak/ooze/dump shares in the float at those higher prices.
Investors know that and usually start selling off before the reverse occurs, that is why smart outfits announce the reverse after hours with no forward notice.

TG
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