effect of trying to obtain large position in a penny stock

Discussion in 'Trading' started by Euler09, Dec 18, 2017.

  1. Euler09


    What is the effect of buying into a stock over a year period, assume 500k-1m volume and price of 25¢? Will the liquidity go down? Will the short term spread increase last ? At what point or percentage will you have to think about a tender offer? Is there any way to do this without being known?
  2. Robert Morse

    Robert Morse Sponsor


    Schedule 13D

    Schedule 13D is commonly referred to as a “beneficial ownership report.” The term "beneficial owner" is defined under SEC rules. It includes any person who directly or indirectly shares voting power or investment power (the power to sell the security).

    When a person or group of persons acquires beneficial ownership of more than 5% of a voting class of a company’s equity securities registered under Section 12 of the Securities Exchange Act of 1934, they are required to file a Schedule 13D with the SEC. (Depending upon the facts and circumstances, the person or group of persons may be eligible to file the more abbreviated Schedule 13G in lieu of Schedule 13D.)

    Schedule 13D reports the acquisition and other information within ten days after the purchase. The schedule is filed with the SEC and is provided to the company that issued the securities and each exchange where the security is traded. Any material changes in the facts contained in the schedule require a prompt amendment. The schedule is often filed in connection with a tender offer.

    You can find the Schedules 13D for most publicly traded companies in the SEC’s EDGAR database. You can learn how to use EDGAR to find information about companies.
  3. kurros


    Regarding the 5% reporting requirement, Does the broker/clearing firm/exchange keep track of that for their clients or is an individual supposed to keep track of the number of shares outstanding?
  4. Robert Morse

    Robert Morse Sponsor

    It is my expectation that it is the investors responsibility. YOu should check with an attorney if anyone ever wants to do that. Not really sure why anyone would do that on an OTC stock.
  5. Euler09


    Some people want to make real money, grandpa.
  6. Robert Morse

    Robert Morse Sponsor

    Do you have the cash to be player like that, son.
    beerntrading and lawrence-lugar like this.
  7. Euler09


    I guess no one knows