If they did a reverse stock split, your 1 share at $250 would become 1/10th of a share at $2,500 each, for a total value of $250.
Stock splits do not make you rich. Anyone who says otherwise is shoveling bullshit on your truck.
For shorts, it's the same. If they were short X number of shares with a total short value of $Z, they would still be short the same amount of money after the dust settles. Their brokerage account would not change, in terms of dollar amount short. So, it is irrelevant.
However ...
Anytime a company does a split (and especially a reverse split) when there is no apparently valid reason to do it (like a $1,000 per share stock price and they want more people to THINK it would be more "affordable" at a lower price), then something is rotten.
It means the CEO/execs/directors are manipulating the stock, and that can never be for a good reason.
If it splits 10:1, you will go from having 1 share at $250, for a total value of $250, to ...
Having 10 shares at $25 each, for a total value of $250.
That's how stock splits work.
^ btw
If they did a reverse stock split, your 1 share at $250 would become 1/10th of a share at $2,500 each, for a total value of $250.
Stock splits do not make you rich. Anyone who says otherwise is shoveling bullshit on your truck.
For shorts, it's the same. If they were short X number of shares with a total short value of $Z, they would still be short the same amount of money after the dust settles. Their brokerage account would not change, in terms of dollar amount short. So, it is irrelevant.
However ...
Anytime a company does a split (and especially a reverse split) when there is no apparently valid reason to do it (like a $1,000 per share stock price and they want more people to THINK it would be more "affordable" at a lower price), then something is rotten.
It means the CEO/execs/directors are manipulating the stock, and that can never be for a good reason.
Thanks for posting this, it’s perfectly said.
I get annoyed at the misinformation and tend to go off.
The REALITY is that it changes nothing. The math remains the same. Literally no one is forced to buy back anything.
Exactly. And THAT is the reason why you know that certain people are purposely lying and trying to con people out of their money.
Not necessarily true. A stock split does make what once was a too expensive stock into something more affordable to appeal to possible investors.
A reversal stock split I agree with. That’s shady.