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If you've been investing for any length of time, I'm sure you know that "reverse-stock splits" are almost always viewed as negative ... you know, bad.
But the opposite is true of junior miner Aurcana Corp. (TSXV: AUN)
The Vancouver-based Aurcana just engineered a one-for-eight reverse split, which was effective when the stock market opened on Tuesday.
Peter Krauth, our resident mining/natural-resources expert and the editor of our Real Asset Returns research service, says Aurcana's reverse split is the first step in a well thought out strategy that could lead to huge gains for the gold miner.
"Bill, I believe this reverse split was intended to bulk up the company's share price and put the company on the radar for a bunch of institutional players," Peter explained yesterday. "It also paves the way for a U.S. stock listing. That, too, will open up the possibilities for a large number of potential new shareholders, both retail and institutional. I believe that this dual-listing (in both the United States and Canada) - and deepening the pool of potential institutional investors - is the end game for Aurcana."
This theory isn't the product of an over-active imagination.
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