That could be good, IF the stock is basically sound, and the split isn’t a Hail Mary by corporate management, to be followed by HUGE golden parachutes.
No joke… I bought into an IPO. I was consulting with the company and thought it would be a “good faith” thing if I did… I bought 300 shares (one of the first stocks I ever bought), knowing enough that it’ll probably never make money. The stock declined a bit from it’s $4 strike price and then split… 1-for-40.
A stock split is neither a good or a bad thing, it’s just a thing.
“Most” stock splits are 2 for 1. For every “old” share you held you are given 2 “new” shares each of the “new” shares has exactly half the value (and dividend if applicable) of the original stock. This allows the company to keep the price of its stock in a range that it thinks is desirable to the owners of the stock.
Not all splits are 2 for 1. Splits can be 3 for 1, 4 for 1, or more. Stocks can also be consolidated, which is called a reverse split, where 2 (or more) of the “old” shares are consolidated into a single “new” share. This is used to increase the price of the shares and is used for several reasons including preventing the delisting of a stock because its price fell below the minimum listing price for the exchange that it is listed on.
Warren Buffett famously refuses to split the Berkshire Hathaway shares so the price of a single share is currently about $347,000 USD.
I generally look on a stock split as a good thing. Theoretically, if it’s good stock and increases in value, eventually you could end up (probably after many years), with twice as many shares at the same value as when it split, without having purchased any more…
wldhrsy2luv over 3 years ago
That’s a good thing, Brutus!
Martin Booda over 3 years ago
Better his stock than the seat of his pants.
allen@home over 3 years ago
I’ll take everybody’s word on that being a good thing. I no nothing about stocks.
GROG Premium Member over 3 years ago
Brutus is only aware of the banana kind of split. He doesn’t make enough to stuff a pillow with – much less invest with.
wiatr over 3 years ago
“Call for Rowdy Yates!”
LookingGlass Premium Member over 3 years ago
Us indentured peons would not know anything about those “stock” thingies!!
fuzzbucket Premium Member over 3 years ago
That could be good, IF the stock is basically sound, and the split isn’t a Hail Mary by corporate management, to be followed by HUGE golden parachutes.
heathcliff2 over 3 years ago
I do occasionally wonder whether he does that intentionally.
nosirrom over 3 years ago
I had an investment where the stock split. So did the CEO, evidently with everybody’s money. ;-)
Meg: All Seriousness Aside over 3 years ago
No joke… I bought into an IPO. I was consulting with the company and thought it would be a “good faith” thing if I did… I bought 300 shares (one of the first stocks I ever bought), knowing enough that it’ll probably never make money. The stock declined a bit from it’s $4 strike price and then split… 1-for-40.
Michael G. over 3 years ago
(Rummaging in my wallet) Here’s a $5 bill, Brutus. Buy yourself a clue.
cubswin2016 over 3 years ago
Take my advice and never talk to a moron. It will only give you a headache.
dv1093 over 3 years ago
I don’t know what it means either.
guy42 over 3 years ago
A stock split is neither a good or a bad thing, it’s just a thing.
“Most” stock splits are 2 for 1. For every “old” share you held you are given 2 “new” shares each of the “new” shares has exactly half the value (and dividend if applicable) of the original stock. This allows the company to keep the price of its stock in a range that it thinks is desirable to the owners of the stock.
Not all splits are 2 for 1. Splits can be 3 for 1, 4 for 1, or more. Stocks can also be consolidated, which is called a reverse split, where 2 (or more) of the “old” shares are consolidated into a single “new” share. This is used to increase the price of the shares and is used for several reasons including preventing the delisting of a stock because its price fell below the minimum listing price for the exchange that it is listed on.
Warren Buffett famously refuses to split the Berkshire Hathaway shares so the price of a single share is currently about $347,000 USD.
raybarb44 over 3 years ago
While good in so many ways, Brutus is definitely NOT the man to trust with your stock portfolio….
ChessPirate over 3 years ago
I generally look on a stock split as a good thing. Theoretically, if it’s good stock and increases in value, eventually you could end up (probably after many years), with twice as many shares at the same value as when it split, without having purchased any more…
cuzinron47 over 3 years ago
I guess it depends on where it split to.
Buckeye67 over 3 years ago
I am afraid his response did nothing to improve the Chief’s opinion of Brutus.
mistercatworks over 3 years ago
My friend had an idealistic young son. He told us that he felt a revolution would be coming. My friend and I both laughed. The boy asked why.
My friend told him, “I used to think a revolution was coming.”
“When did you stop?”
I said, “When we bought stock.”