FAS/FAZ reverse stock split:
By Daniel at 8 July, 2009, 11:19 am
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Generally I don’t want to be in a stock that has a reverse stock split because generally it means that the company and stock have gone completely out of favor and are using the stock split as a means of staying in whatever index they are in by not falling below a certain price level. Here is an article about them if you are interested:
http://moneycentral.msn.com/content/P32972.asp
All that said, I think in the case of FAS and FAZ it will have no affect except that absolute moves on both will be greater owing to the higher price that will be reflected with the split. Being that they are index funds they will continue to move with the under lying index they are tied to.
There you have my thoughts for what they are worth.
FBB
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I disagree. FAZ/FAS shareholders just got F* up the asss. Why did it fall from $200 to $5 in 8 months anyways when other ETF managed to stay in the mid-$40+?
It only costs me $9 to trade unlimited shares of FAZ/FAS… and the low share price brought in a lot of investors willing to take a gamble at $5. who in their right mind would pay $500/sh for FAZ?? Not anyone I know. I’d much rather pay $41/sh for a more stable fund like MZZ (which is going to be 25% cheaper than FAZ post split with about the same upside).
This was just another money grab by Dierxicon and a perfect shorting opportunity… FAZ will see $5 again!