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Question for the stock guru’s on Amazons 20/1 split tomorrow?
Posted on 6/2/22 at 5:59 pm
Posted on 6/2/22 at 5:59 pm
What does this mean exactly for someone (elderly parent who has owned a mutual fund heavily invested in this for a long time) exactly?
I own a small TD Ameritrade account that I buy ETF’s in on occasion that rarely pan out, but I have no clue on how to answer her question to the letter she received?
It’s also invested in the alphabet stock which is due to do the same so the letter sent on the 14th of this month says or the next month.
Any information would be helpful?
Thanks!
I own a small TD Ameritrade account that I buy ETF’s in on occasion that rarely pan out, but I have no clue on how to answer her question to the letter she received?
It’s also invested in the alphabet stock which is due to do the same so the letter sent on the 14th of this month says or the next month.
Any information would be helpful?
Thanks!
Posted on 6/2/22 at 6:04 pm to Brandonthepotato
Instead of owning a dollar, she will own 20 nickels.
This post was edited on 6/2/22 at 6:11 pm
Posted on 6/2/22 at 6:04 pm to Brandonthepotato
Imagine a whole pizza and then slice it into 20 pieces. Do you have more/less/same pizza as before?
Posted on 6/2/22 at 6:12 pm to Brandonthepotato
Thanks members that explains it will it devalue or increase her worth overall or will that be defined by the market shift in response if this is the right question?
I guess outside of volume (layman’s) perspective nothing really will change?
I guess outside of volume (layman’s) perspective nothing really will change?
Posted on 6/2/22 at 6:20 pm to Brandonthepotato
quote:
Thanks members that explains it will it devalue or increase her worth overall or will that be defined by the market shift in response if this is the right question?
I guess outside of volume (layman’s) perspective nothing really will change?
Which is worth more?
A dollar or 20 nickels?
Answer that and you've answered your question
This post was edited on 6/2/22 at 6:23 pm
Posted on 6/2/22 at 6:21 pm to Brandonthepotato
Dude, do you have more/less/same amount of pizza?
This post was edited on 6/2/22 at 6:22 pm
Posted on 6/2/22 at 6:40 pm to Brandonthepotato
Some would argue that demand would go up due to shares being more affordable. But that is not always the case.
Posted on 6/2/22 at 7:30 pm to Brandonthepotato
Thanks for the replying!
Posted on 6/2/22 at 7:32 pm to LSU in the hizzle
quote:
Which is worth more? A dollar or 20 nickels?
I’ve seen various explanations using other examples. But I really like that one!
When I’m trying to explain stock splits to my girlfriend’s kids, I believe I’ll borrow that from you.
Posted on 6/2/22 at 8:24 pm to Brandonthepotato
Nothing changes as long as they keeping rocking the 60 P/E ratio. If investors bring it down to 30 or 20 a lot changes
Posted on 6/2/22 at 9:53 pm to LSU in the hizzle
quote:
Instead of owning a dollar, she will own 20 nickels.
so, it'll be around $125/share tomorrow? cool. i might actually have something to invest my roth into now. it's just sitting in my fidelity account waiting to be spent.
Posted on 6/2/22 at 10:17 pm to finchmeister08
^^^and this is precisely why it’ll get a little bump like most stock splits. Meaningless, but so many buy because “it’s cheaper”
Posted on 6/2/22 at 11:47 pm to TigerDeBaiter
So it’ll split and never gain to its price ever again? Like… never? That’s unfortunate.
Posted on 6/3/22 at 5:04 am to finchmeister08
Did I say that? The price is ultimately dependent on the earnings and multiple the market is willing to pay.
The point is, if you have a one dollar bill and go get 20 nickels, do you have any more value on that dollar? No.
The point is, if you have a one dollar bill and go get 20 nickels, do you have any more value on that dollar? No.
Posted on 6/3/22 at 6:36 am to LSU in the hizzle
quote:
Instead of owning a dollar, she will own 20 nickels.
But over time those 20 nickels will either grow larger or shrink into something smaller.
Posted on 6/3/22 at 7:19 am to TigerDeBaiter
quote:
Did I say that?
the way i read your comment made it out like i'm some kind of idiot for buying after a split or something.
Posted on 6/3/22 at 10:11 am to finchmeister08
quote:
he way i read your comment made it out like i'm some kind of idiot for buying after a split or something.
Nah, but your comment made it sound like you didn’t like Amazon at $2400/shr, but do like it at $120/shr post split, which is illogical.
The only reason to buy it specifically after the split instead of today is if you can’t afford a full share with your available cash.
Posted on 6/4/22 at 11:32 am to Skervix
quote:
Some would argue that demand would go up due to shares being more affordable.
This. Also they will get a boost from the publicity.
Posted on 6/6/22 at 5:55 am to slackster
quote:
The only reason to buy it specifically after the split instead of today is if you can’t afford a full share with your available cash.
Afford 100 shares without affecting portfolio diversification Does unlock writing covered calls
Posted on 6/6/22 at 7:31 am to Brandonthepotato
It may make the company more enticing for inclusion in a prominent price-weighted index, which may in turn drive index funds that track that index to buy shares
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