donkpow Posted February 21, 2020 Share #1 Posted February 21, 2020 As many of you know, I play a little in the stock market. Specifically, the US markets with micro, small, and mid cap companies. I spend some time finding companies that I think can make me a bit of money. Usually, I'll add a stock to my portfolio with a small investment and then dig in with it to see if it is worth more money. Then I watch it to see how it moves. Last year, I had three episodes that give you an idea how things work in this millieu. Example #1: not a bad company, low stock price moving in the right direction, company moving in the right direction. I was already increasing my stake in the company. The bastards did a 5-1 reverse stock split. This is when the company consolidates the stock in your portfolio into a less number of stocks. In this case, if you had ten stocks, after the reverse spit, you would have two. The market hates reverse splits. I lost money. Example #2: not an excellent company, high risk, low cost to me. I was already leery about this company because the numbers were way off. I went ahead and bought some and kept a close eye on it. I sold out of my position to take a 10% profit. I bought back in with a lower stake and sat back to catch another swing. Those slackers executed a distribution. A distribution is when they issue more stocks onto the market, generally diluting the value of your stocks. This was the second time they issued a secondary public offering within a year. Somebody sold a million shares within minutes of the announcement. Stock price dropped 50% and now I am sitting on a rock waiting for it to hatch. Example #3: an excellent foreign investment traded on the NYSE, I bought in and was in the process of building my position. This stock was going to be a big winner based strictly on the quality of the company. The MF'ers did a spin off. Placed the good part of the former company in the European market and left the riskier, lower performing entity in the US market. I don't have access to foreign markets. I lost a little and really only lost because it took me a while to act. Example #4: good US company, good market position, good industry. I was building my position in the stock. Don't forget, I'm running my own portfolio. A European company announced a merger with this company with quite high stock purchase price. I sold out and made 67% over my investment in like a month. Woot, woot. Winner, winner. Kiss my ass. I win. 1 Link to comment Share on other sites More sharing options...
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!Register a new account
Already have an account? Sign in here.Sign In Now