Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : Bad investing information/advice on the net contest -- Ignore unavailable to you. Want to Upgrade?

To: Edwarda who wrote (190)	1/15/2000 7:52:00 PM
From: Phil(bullrider)	Read Replies (1) \| Respond to of 214

To all: Since I am a relatively new investor there are two things that were recently brought up that I would like to discuss. First, even though I agree that a stock split is fundamentally a non-event in relation to the price of an equity, most people believe they are getting a better deal if they buy after the split. I guess they believe cheaper is better. I always wondered why most stock prices declined substantially right after the split. The theory that a lot of investors sell the split shares makes a lot of sense. If one didn't mind the commissions and taxes, it would seem to be a smart move to buy just before the split, wait for the selloff, and buy back in. Personally, I try to hold until the price is back up to the pre-split price before I sell the split shares. I have done it several times with success. Secondly, I never gave it a thought that some would not buy an equity unless they could afford a hundred shares. It makes sense though. In that case, I understand even more why a split is good for current investors. Anyway, Have fun, Phil

To: Edwarda who wrote (190)	1/18/2000 5:10:00 PM
From: The Other Analyst	Read Replies (2) \| Respond to of 214

You noted that if the stock splits the small investor can buy more because of the "round lot" problem. As you know, but apparently some have ignored, there is no longer any relevance to the round lot notion. Trades now are priced per trade, regardless of the number of shares. It's $29 or $20 or whatever for any trade, whether it is 100 shares or 13 shares. So we cannot attribute any rational thinking to these investors' preference for splits.