What is one consequence of a lower free float in shares issued to the public?

A lower free float refers to a scenario where a smaller portion of a company's shares are available for trading by the public. This situation typically leads to higher share price volatility. When there are fewer shares available in the market, any significant buy or sell orders can cause larger price swings. The limited supply means that even small changes in demand can lead to considerable fluctuations in the share price.

This volatility can affect both the perception of the stock by investors and the behavior of traders, who may react more starkly to news or changes in the market due to the constrained supply of shares. Thus, a company with a low free float may present a riskier investment, as price stability is compromised, resulting in increased volatility.