AIG - Stock split shares plummet worried investors
AIG stock tumbles almost 20 percent ater a 1 for 20 reverse stock split by AIG. It really send negative waves as investors threw their AIG shares causing AIG to go down $4.53 or 19.5%. So brother Loke are you worried?
How does the split works?
Before split = 1000 shares
After split = 50 shares
1000/20 = 50 (1:20)
Basically i have 1000 shares of AIG bought at $1.28. Now will only have 50 shares as the stock has split into 20. To breakeven, i need to wait for my AIG stock to be :-
$1.28 x 20 = $25.60
What will i do?
To be honest i will just keep my AIG stocks under my pillow as i am confident it will not die.
Why i am confident?
Up till today, the US government owns 80% of AIG. So if the US government have the balls to own 80% of AIG and let it die, then i wont mind letting my 50 shares of AIG to burn. US government titanic ship sink, what is my small little boat compared to titanic? Show me your guts if you really have it to close down AIG.
Conclusion
I will just leave my AIG aside and watch more drama unfold but the bottom line i am still confident about AIG future prospect. It is a too big company to just let it die off. So brother Loke, do you share the same optimism as me?
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4 Responses to “AIG - Stock split shares plummet worried investors”
By LOKE on Jul 3, 2009 | Reply
Hi, Kampung Boy.
I think in the same way like you. AIG is still alive after so many big challenges. And now, the world economy starts to show some signs of recovery.
AIG is trying to reconcentrate on its core business, i.e. insurance business. And as we all know, insurance is a very good business. Cash flows in every month.
If AIG is successful in settling the toxic assets which are the main culprit of the nearly AIG collapse in last September, AIG can be a profitable organization in future.
To me, as long as AIG is still alive, nobody can be very sure that our investment in AIG is a mistake. Only time can tell.
So, let’s wait and see how AIG performs.
By jeff on Nov 3, 2009 | Reply
hi, i bought aig, citibank, ge, cit… wondering u bought with wat bank. i’m using rhb, thinking of the commision too high. 35 USD per trade.
By Kampung Boy on Nov 4, 2009 | Reply
Hi there jeff. I started use RHB as well because it was the only option i had that time and i wouldn’t want to waste more time. So my first stock purchases was with RHB Invest.
The problem i had with RHB Invest is that it wasn’t real time. Currently i am using http://www3.dmg.com.sg/ (Is a partner of OSK)
If i am not wrong, the main reason why you are paying high commission is because you have to pay commission to RHB and their partner investment house (Like DMG).
So i decided to open straight with DMG instead of me needing to go through OSK. From there i save one hand.
But from my point of view, not much of a difference Jeff if you are a long term investor. Like for Citibank what is your target price? Ask yourself that question and compare the 35USD and your target price. It’s chicken feet right?
Unless you are playing Contra then every penny counts. Hope my 2cents information helps!