I am not the one to ask about broker and rules. From what I have seen it makes no difference about stockholder of record. you sell before you get the money, you buy more you get the split.
Think about it, a 2 for 1, just doubles stock outstanding or cuts in half the value of a share. you have a 100 shares of a stock at 90, you buy 100 more at 100 where it closed, it splits and you sell at 50. one day you had 200 shares worth $20,000 with $1000 profit, next day you have 400 worth $20,000. remember percentages count, after a split increases and decreases are doubled percentage wise. if the stock goes up 10 points from the 50 to 60,it is 20% or $4000 or a worth of $24,000 with $5000 profit, from 100 without split the 10 points is 10% or $2000 for your 200 shares or $3000 profit. Decrease is same thing, so your 10 points down after split leaves you with $16,000 or a Loss of $3000; without split, the 10 points down would have you at $18,000 or a $1000 loss.
Well I told you more than you asked, splits are good if stocks continue to go up, but remember if they go down the loss can hurt you per point.
I just read it back, confusing but a point somewhere. |
