Small add to AMD and Nvidia stock split

Increased my AMD holding by 10% to give a roughly equal weighting with Nvidia. Very much like AMD management – best on the block.

Nvidia has just split its stock so one old share becomes four new shares. There is a lot of chatter about stock splits so here are the irregular rules. A company who splits their stock or makes a bonus issue is usually doing well – if they give out very small options to low level employees 100 shares sounds better than 25 ! The irregular rule is that the share price will most probably rise over the medium term.

A reverse stock split is also known as a consolidation. This usually takes the consolidated share price lower in the short term as many companies that consolidate are penny stocks. How did they become penny stocks in the first place ? Often poor management – or if management recently changed the business itself might be destined for bankruptcy – just because some businesses fail despite having reasonable managers..

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