***Official*** 2010 Stock Market Thread

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Cattlegod

Diamond Member
May 22, 2001
8,687
1
0
eLiu said:
Someone can correct me if I'm wrong, but let's take a simple example. Suppose company A has 100 shares outstanding valued at $1 a piece. So company A is worth $100.

If company A releases 100 more shares of stock onto the market, assuming their value stays constant, the shares are now all worth 0.50/share. So companyA gets 0.5*100 dollars to spend on things, and the people owning hte original 100 shares are angry b/c their shares got devalued. Releasing new shares is called "dilution". In general, dilution is viewed as a sign of weakness & usually the stock takes a hit after dilution; e.g., the company is releasing stock to raise money b/c they're in trouble. In this case, the holders of the RMBS convertible will convert them to shares if the price goes over 26.80, meaning that the net # of shares will increase (even though RMBS didn't release them directly).

The real story is more complex than that. Sometimes dilution doesn't signal weakness (HGSI for example, rose after its several dilutions). You can look into that more if you want, but the message is that dilutions aren't always a straight up negative. It's particularly complex with say biomed companies that are simply developing products and don't really have any kind of income.
Click to expand...

keep in mind that it isn't as completely as bad as it sounds. this is true because with the transfer of the convertible bonds into shares, the company now no longer has that bond debt to pay back.
 
J

Jassi

Diamond Member
Sep 8, 2004
3,296
0
0
So.... offering @ 2. What say you all? I could maybe scrounge up couch change for 2-300 shares.

Anybody buying more?
 
K

KDKPSJ

Diamond Member
Dec 13, 2002
3,288
58
91
Actually, I just found out that offering is @ $ 2 as well. Not bad. I hope it finds support at around $ 1.95.

And grat for me, I just became an investor of GNVC. lol.
 
IEC

IEC

Elite Member
Super Moderator
Jun 10, 2004
14,600
6,084
136
I sold off three other positions and am buying a boatload of GNVC. My risk-o-meter just shot up...
 
R

richardycc

Diamond Member
Apr 29, 2001
5,719
1
81
They still have the prostate phase 1 study news coming..once that is out, it should go up at least 50cents with that news. They somehow deleted the entry from the website, maybe they didn't know people would use that site for news materials.
 
H

HopJokey

Platinum Member
May 6, 2005
2,110
0
0
richardycc said:
They still have the prostate phase 1 study news coming..once that is out, it should go up at least 50cents with that news. They somehow deleted the entry from the website, maybe they didn't know people would use that site for news materials.
Click to expand...

When's that due out?
 
T

thepd7

Diamond Member
Jan 2, 2005
9,423
0
0
I only had $100 cash in my account since I'm tied up elsewhere but I bought some GNVC @ 1.79. A measly 55 shares but it's a start.
 
J

Jassi

Diamond Member
Sep 8, 2004
3,296
0
0
I'm glad I stayed out in the 1.8x range but this thing is not developing a floor at the moment.

In @ 1.7895 for a few shares. My emergency fund just took a hit :(

Also, Etrade reports in 2 hours. I'll be in a meeting so I expect to lose quite a large pile of cash on paper when I get out at 5.
 
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FelixDeCat

FelixDeCat

Lifer
Aug 4, 2000
30,973
2,676
126
Ok I bought a couple of Feb $15 LVS puts @ .62 today. This market is not doing well. May as well cash in.
smileydance.gif
 
SSSnail

SSSnail

Lifer
Nov 29, 2006
17,458
83
86
Never buy a stock because you think it's cheap. I too have became "investor" in a few stocks that I thought was cheap.
 
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