Monday, March 12, 2018

What does usually happen to the price of shares when new shares are "released" to the stock market?

Lets say a company in total has 200 shares. 100 of them are not publicly traded and belong to the owners of the company and the other 100 are publicly traded. Later, the company decides to release 50% of their non-publicly-traded shares to the public stock market. So in total 150 shares are now being available for public trade at the stock market.

What does usually happen to the price of a share in this scenario?

IMO the price inevitably drops if there isn't enough demand and the market already was saturated with the 100 shares that were initially listed.



Submitted March 12, 2018 at 06:25AM by Polypropylen http://ift.tt/2HoarHW

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