1 For 20

This past Wednesday one of the stocks that I own went through a 1 for 20 reverse stock split, what that means basically is that I would get 1 share for each 20 shares that I owned. From, what I’ve read companies do this to boost their stock price and not look cheap. American International Group Inc (AIG) was at $1.16 when the split took place and it closed yesterday at $18.25. The stock price sure was boosted but at the current price I am in the loss column.

When I first bough American International Group Inc (AIG) I did it because it was cheap and I could buy quite a few shares, 1500 as you know. If the stock moved .10 cents I would make $150 dollars but now that I own 75 shares I would only make $7.50 and that simply sucks. I would take .10 cents with 1500 shares over .10 cents with 75 shares anytime. And just like that my “volume” strategy came crashing down.

I am very disappointed with the reverse split and don’t understand why shareholders would vote for such a move. I don’t know what I am going to do with AIG at the moment but as soon as I make a decision you will read about it.