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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: Robert Graham who wrote (3615)	9/5/1999 1:36:00 PM
From: marketbrief.com	Respond to of 18137

hi bob, oh yes, i agree completely that the character of a stock changes post-split and also post-catastrophe, as you mention. All these flavor of the day stocks like GRIN or whatever are fun for a couple days but then they get thin and untradable... the idea is their "character" goes from kind and clear (liquid, consistent) to mean and muddy. I was talking with KM about rambus the other day and i said ya know i took one look at that sucker and said that is run by the kind of mean bastards i don't like messing with in the market and she agreed but has a handle on their shenanigans, understands the "character" of that stock, so she can trade it marvelously whereas I would just be handing over my wallet if I stepped into that ring out of nowhere... back in the old days when NSCP was around I firmly believed that no one on planet earth understood its action as well as i did, since "we" had a kind of intimacy that can't be put into words... i really felt sorry for some of the bids and offers i saw put in cuz i knew that these were uninformed souls who didn't understand my baby. ~Smart$

To: Robert Graham who wrote (3615)	9/5/1999 1:43:00 PM
From: Tai Jin	Respond to of 18137

I think splits affect stocks differently depending on when it happens in their growth cycle. Witness the Internet stocks that have in the past couple of years been running up so fast and splitting so often. There are a number of factors which caused this: small initial floats, incredible interest in these stocks, lots of hype, etc. Many of these stocks have gone from tens of dollars to hundreds of dollars in a short period of time leaving many who missed the boat itching to get in when the price came down. So when there is a split from 200 to 100 those who missed out before want to get in thinking it will go back to 200. So the rapid growth of the stock feeds on itself. But once the stock has split a few times and the float has increased considerably (e.g., EGRP and AMZN) and earnings begin to matter then the game changes. The stock no longer runs up like it did before. The so called investors seeking overnight riches expecting the same incredible gains as before will be disappointed and may be more likely to sell sooner rather than hold the stock as an investment. The momentum crowd leaves as the ability to move the stock decreases. Now fundamentals and the long term investment crowd begin to drive the stock. ...tai