th a minimum risk, by being guided principally by
the major movements, while taking advantage of the minor movements in a
minor way. However, stocks do not move uniformly and there frequently is
an opportunity to buy some particular stock at a bargain when nearly all
stocks are selling too high. We try to pick out these opportunities for
our clients.

Reports of earnings by various companies influence stock prices, as does
also the paying of extra dividends or the passing up of dividends. A
peculiar psychological influence is noticed when a company declares an
extra dividend. The price of the stock usually goes up, while as a
matter of fact the intrinsic value of the stock is decreased by the
amount of this dividend; and sometimes it is advisable to sell a stock
shortly after an advance in its dividend rate.

CHAPTER XIV.

TECHNICAL CONDITIONS

Technical conditions refer to the conditions that usually affect the
supply and demand, such as short interests, floating supply, and stop
loss orders.

It is sometimes said that supply and demand must be equal or else there
could not be any sales, but that is not so. There are always some people
who are willing to sell at some price above the market who will not sell
at the market; and when the demand for stock is greater than the supply,
it goes up until it is supplied by some of these people who are holding
it at a higher price.

It works the same way when the supply is greater than the demand. There
are always some people who will buy at some price below the market.
Therefore, when the supply is greater than the demand prices must go
down.

A stock may have an intrinsic value of $100 a share and yet be selling
at $50 a share, and it can never sell higher than $50 until all stock
that is offered at that price is bought.

However, you should keep this in mind: if the real value is $100 a
share, sooner or later the market price will approach that figure. That
is why we so strongly urge our clients to buy stocks that have actual
values, or at least prospective values far greater than their market
prices, and either to buy them outright or margin them very heavily, and
then hold them until the prices do go up.

Of course, when one finds that a mistake has been made, the sooner one
sells and takes a loss the better.

CHAPTER XV.

MANIPULATIONS

Stock prices are influenced largely by manipulation. Years ago when the
volume of trading on the New York