Smells even funnier
by Volker Weber
Ask $6, bid $2.75, for 500. That is quite a spread. Very hard to turn stock into money. Why would you sell stock that has a target of $9? Simple. You rather want money now.
For the sake of argument, let's assume you would like to sell your privately held company and cannot find anybody who wants to pay cash. Then you might be tempted to sell for stock in a publicly traded entity. Once you start selling those shares you may find out that they are less valued than you thought. Hence the spread. And the stock goes from $4.25 close to $4 open via $3.8 for the first trade to $3.5 for the second. Who wants to go short?
Watch this space.
Comments
What is a 'Target' for a stock? Nothing but a figure some crackhead called Mr. M.T. Suit came up with after scratching his scrotum. The price is right when buyer meets seller. End of story.
