When a stock goes through a corporate action like a merger or a reverse split, often some shareholders are left with fractional shares. Instead of leaving a shareholder with a fractional share, the company will often pay them the cash value of the fractional share. Often this is referred to as “cash-in-lieu.” Is there any …
How to Trade Special Situation Cash-in-Lieu for Profit Read More »
Companies start out as private companies, and sometimes later go public, selling shares on an exchange or over-the-counter. Companies with tradable stock are public, but your local laundromat is probably private. There are a few big private companies like Lego, but it’s rare. Going Private With a Reverse Split Sometimes a company goes public, but …
Reverse split arbitrage is the only way I know to make 10x returns on investments as small as a dollar in the stock market. In fact, the only way I know to make returns on that small of an investment in any capacity is flipping from the Craigslist free section and garage sales. In March …
How to invest profits from Reverse Split Arbitrage? Read More »
In a reverse stock split, a company consolidates shares at a fixed ratio. In one example, every 10 shares is consolidated into a single share going forward. Because the total value of the company hasn’t changed, this new share is worth 10 times the price of an old share. The value of your investment is …
In a reverse split, shares are consolidated at a specified ratio, say 10 to 1. In that case, every ten shares would be worth one share. Because the value of the company hasn’t changed, the new shares are worth theoretically 10 times as much as the old shares. There are a few reasons companies might …
What happens to options in a reverse stock split? Read More »
Some reverse splits attempt to preserve round lots. This just means they will try to have the same number of people holding 100 shares before and after the split. This post looks at three ways companies have tried to preserve round lots in the past, and how investors can profit from these rare opportunities.
Say a company performs a reverse stock split. You buy a single share, and after the split your fractional gets rounded up to a full share. Where does this free money come from?
Stock splits, either forward or reverse, shouldn’t change the actual value of a company’s equity. Stock splits simply cut the pie into smaller or larger slices, but the pie is the same size. So why do they do it?