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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Douglas A. Sevy who wrote (22315)	11/20/1997 8:06:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

Doug, if a stock splits so does the option. Also, when a stock splits, the daily movement splits also. For example, if I were interested in selling Dell shares at a limit of $86, and the stock closed today at $85 3/4 and were to split two for one, my limit would then be $43 -- 1/8 above the split price -- not 1/2. The daily volatility expressed as a percentage of the price of stock doesn't change. The point that I'm trying to make is that all a split accomplishes is an increase in the number of pieces of paper -- nothing else. The proof is if you compare very expensive stocks like Berkshire Hathaway with very inexpensive stocks you find about the same P/E's. In other words, splits don't cause the price of a stock to rise. About the only thing that a split means is that the management of the company generally feels good about the future prospects of the company. This is a kinder, gentler Paul wishing you good luck.