Ask a Fool: Whatever Happened to Stock Splits?

In this edition of The Motley Fool's "Ask a Fool" series, Motley Fool One analyst Jason Moser takes a question from a Fool reader, who asks: "Whatever happened to stock splits? There was a time when stocks were always splitting."

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  • Report this Comment On December 06, 2013, at 3:56 PM, mazske wrote:

    Jason,

    I completely agree and understand all you said.

    However, for small time investors, if we are interested in a stock like Google, when the share prices gets so high, over $1000, it is hard to find the money to get a share.

    Case in point, my college age son. He is currently saving $50/month and every 5-6 months, he makes a small buy. He is doing quite well.

    Yet, to get one share of Google, he would have to save for almost two years. And, in that amount of time, who knows what the share price would be then.

    I try to make monthly stock buys. I may have $300-$350 for each buy.

    So, for me to save to get one share of Google, I would have to save for three or more months.

    I do own shares in Google, but would like to pick up more over time. Yet, due to the high price, I may not.

    Thanks for the video.

    mazske

  • Report this Comment On December 06, 2013, at 7:03 PM, Kimmersrenee wrote:

    I personally like to see one of my blue chip stocks split. There is a practical reason for this with dividend stocks. When a dividend stock splits, and instead of 1 stock I now have 2, and they raise their dividend I get more dividend . So for me and my long held dividend stocks it ls like getting a raise on top of a raise if they increase their dividend.

  • Report this Comment On December 12, 2013, at 8:56 AM, LexSC wrote:

    Stock splits do not add value to the stock, but they can can provide greater opportunities for people to sell covered calls. Some of the higher priced stocks do not have mini's (contracts for 10 shares as opposed to 100 shares).

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