Aig

[eastont]

The stock market can be very scary. I held shares in AIG which cost $1.35. I have sat on then for a couple of months and then suddenly the company does a reverse stock split 20:1. This means my number of shares went from 5000 to 250. The closing price on Thursday was $18.25 x 250 = $4562. If this split didn't happen my holdings were 5000 x $1.35 = $6750. So now the stock must get up to $27.00 before I even break even.
And they say boating is costly.........

 

[gonefishie]

Re: Aig

Are you expecting a failing company to gets their head out of their behind or what?

 

[tashasdaddy]

Re: Aig

This Better Not Turn -- Political.

 

[dave11]

Re: Aig

The stock market can be very scary. I held shares in AIG which cost $1.35. I have sat on then for a couple of months and then suddenly the company does a reverse stock split 20:1. This means my number of shares went from 5000 to 250. The closing price on Thursday was $18.25 x 250 = $4562. If this split didn't happen my holdings were 5000 x $1.35 = $6750. So now the stock must get up to $27.00 before I even break even.
And they say boating is costly.........

Our paper said the market didn't like reverse splits. They expected AIG now had that much farther to fall.

 

[kenmyfam]

Re: Aig

You can be sure they did not do it for the shareholders benefit.

 

[PW2]

Re: Aig

If you bought it a $1.35, that means you bought it after it was learned it was a failing company. Very Risky!!!

There is a chance it will come back. Most of their businesses were profitible--it was only the financial products division and the credit default swaps they sold that (almost?) did them in.

Who knows--they may be able to extract themselves from that mess--if they can, they may come back---but you made a big gamble. like any gamble, it may pay off, but then again it may not.

 

[tx1961whaler]

Re: Aig

I have never seen a company that does a reverse stock spit survive. Maybe somebody can provide an example of one that has ???

 

[BoatBuoy]

Re: Aig

The closing price on Thursday was $18.25 x 250 = $4562. If this split didn't happen my holdings were 5000 x $1.35 = $6750.

The stock split in and of itself didn't cause your loss. After the split, it went into a tailspin. The board voted for the split because any share that drops below $1.00 is dropped from NYSE.

tx1961whaler, yes, company success after a reverse split is rare. Cardima, Inc is one that did succeed.

 

[aspeck]

Re: Aig

Buying AIG after the bad news was taking a risk. I hope you had advice on the risks that were involved.

That said, and as pointed out already, AIG does have profitable sections. They may pull out of this. If they do, your initial investment will turn into a real winner. If not, well, you have probably lost money before on bad deals.

I enjoy the market, the calculated risks, etc. But I also realize that any investment can go south at any tiime. Patience and long term will be the course for this one IF it is be a winner. Or, you could bail now and lick your wounds.

Personally, I would not have taken the risk on AIG, although I did think about it and it was tempting at the prices it was trading. However, if I had it now, I would probably hold on to it and see what would happen. I am in no way giving you advice, just stating what I would probably do.

 

[PW2]

Re: Aig

They at AIG are in the process of spinning off their various profitable businesses to raise cash to pay off their losses. My auto insurance used to be AIG--It's now "21st Century"

I agree with Aspect. At this point I'd probably hold it and hope, although I subscribe to the greater fool theory of stock investing, or that whichever stock I buy there will be a greater fool than I willing to pay more money for that stock at a later date.

I prefer only investing in stocks where finding that great a fool is at least possible.

 

[samm835]

Re: Aig

AIG, the insurance side of the company is still one of the strongest carriers out there even after the huge issues they have had. If you look into the company, they have more available cash to pay claims than the other carrier. AIG still sets the rates for insurance in the market, granted this might change this year...but the insurance side is still very strong and has a good bit of cash available. Most people read what is in the paper or what they hear on the news and get scared and run or start talking with out finding out the facts. I am in insurance.....and I do understand these companies...but stocks are always a risk, it will take I am sure years for the stock to go back up. I am like you eastont.......although my shares were bought when the were being sold around $15.00 and I HAD about double what you have...LOL so YES I feel your pain!