Not sure whether this issue has been sufficiently addressed: some have expressed concern about the difference between dividend and split, in terms of the share price being reduced post-split. I've now spoken to several brokers about this, and the consensus I'm getting is that after a split, the share price *will* be reduced accordingly, and in fact, that is the best way to determine when the x-div date has actually occurred (and, was also told that the BOD determines this date, not NASD or SEC). However, when I described the situation as that of a stock (MIDLP) that may only trade a few thousand shares per day, it was also agreed that market demand *could* allow that the price actually may never drop (if post-split there are still people willing to buy at the pre-split price, and if people are unwilling to sell at a post-split-adjusted price).
Now, most interesting, I was also told that even in the case of a dividend, the share price should also automatically reflect the dividend after the dividend is given. So, for all of those who were thinking that a split is somehow disadvantageous for this reason, apparently the same rule applies with regard to post-div/split share price adjustment.
At least that is what I have heard so far. If anyone has heard or knows otherwise, please let us know.
Just a lurker de-lurking...
Darci |
