How dilution works (selling additional shares into market)

A company's goal is to sell off shares methodically, without driving the prices down too rapidly. The investment bank trading desk in charge with executing the trade will sell off a portion of the total position and may even buy some back for sale, attempting to hold prices within an acceptable range. This back and forth price action appears as a horizontal trading range on the stock chart. The company's goal in raising needed cash is to seel off shares at an acceptable average price. Once the entire position is sold off and diluted into the market place, eventually the prices begin to drop as the public now has now one keeping the price up.

This pattern is easily predicated based on high volume with very little price movement.

 

So would this explain todays (Monday) slight price decrease on heavy volume and strong buyout rumors ? Is it management dumping shares into market place as part of the ATM ?

 

Diluting right now would be the absolute worst time for Pernix. They would just be opening themselves up for an SEC investigation if the buyout rumors prove to be false. Could be seen as Pernix orchestrating the pump themselves in order to increase SP before diluting.

 

Yep, dumbest thing I ever hear to say they are diluting now. Jail time and lawsuits guaranteed. Very stupid post. Sell your 100 shares and move on instead of wasting our time.