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Microcap & Penny Stocks : AmeriResource Technologies (ARET) -- Ignore unavailable to you. Want to Upgrade?

To: firstman who wrote (1960)	8/30/1998 2:28:00 PM
From: TraderGreg	Read Replies (1) \| Respond to of 7609

A reverse split would be idiotic at this point. Shrewd companies would dilute and use controlling interest to incrementally raise the authorized number rather than reverse. They would reverse only if they do not have controlling majority since reverses can be voted on by the board while increases to the authorized shares require a proxy vote. Assuming, as Jens has said, that the conversions are nearly complete, selling is naked shorting and/or share issuance. The latter can be verified by the TA, i. e., if no share increase exists then shorting is the culprit. Who would short at these levels you might ask? Many shorters would, and some are MORE likely to at these levels. Each .001 drop in price at .01 is three times the rate of return of shorting at .03. And if they are successful at getting the price literally to 0, they never cover. A shorter that doesn't have to cover also doesn't have a taxable event. No taxable event means 100% rate of return...the maximum possible. On the other hand, shorting at .01 results in three times the loss for every .001 increase in price as compared to shorting at .03. So it is a high risk activity. Would I short at these levels? No, but I'm an optimist<g> TG