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Microcap & Penny Stocks : FAMH - FIRAMADA Staffing Services
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To: Amy who wrote (9397)3/30/1998 10:23:00 PM
From: Carolyn S.  Read Replies (1) of 27968
 
>>A lot of excitement continues regarding this stock...However, am I the only one concerned with the 4 for 1 reverse stock split that I read about in last week's PR? Having my stocks reduced to 25% of my original purchase has created a bit of concern... What am I missing? Please fill me in. Amy<<

Amy -

I see you're a new member since today.

If a stock reverse splits, you end up with fewer shares that are each worth more because they represent a larger piece of the whole.

For example:

If a company had 40 million shares total, and reverse splits 1 for 4, then the company only has 10 million shares total to represent the value of the company.

So if you owned 1000 shares of a stock @ .50 per share, and the stock reverse split 1 for 4, you would have 250 of the new shares worth approximately $2 each (4 x .50).

Approximately, because the market (buyers and sellers) actually determines the value of the shares.

Carolyn S.

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