Stock Floats

I never really understood the value of floats.

It's like saying, " The man is 200 lbs., 6 feet three inches, and has a 36 inch arm." Unless I am engaging in a boxing match with that individual, I don't care about his arm length.

I cringe when I hear people asking, " What's the float?" First of all, they probably don't even understand what they're asking for. Second, does it really matter?

Here is the only time float matters to me. I see a stock running on Nasdaq and it's up 15% for the day. If I see that the company has 30 million shares outstanding and a float of 3 million, I may be more hesitant to buy that stock knowing the reason for the run could be lack of supply. Using the same example, I would be much more willing to buy a stock if there are 30 million shares outstanding and the float is 24 million.

Float allows to me to apply the theory of supply and demand to any stock run. That's the only thing it's good for other than ice cream. A little humor for the holiday season !!!