I have the stock AGQ, a silver stock. Today the stock split, according to yahoo. I have had stocks split before and received double my quantity. The stock went from $16 per share to over$ 60. I researched and it was a 1:4 split. Why would a company go this direction? Thanks for your help.
This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.
First, AGQ is not a “silver stock”. It is an ETF that is leveraged 200% to the daily performance of silver bullion. (e.g. if the price of silver bullion goes down 2% the price of this ETF drops 4%.) This ETF just experienced a 1:4 reverse split because of the significant drop in value it has experienced during the past year. For every 4 shares of AGQ that you originally purchased you now own 1 share which is priced four times higher than it was last week. The total value of your position remains the same. These leveraged ETFs are generally used as short term trading vehicles and are not designed to be long term holdings.
Great succinct summary. Mahalo. I hope Gumshoe puts you on the first to get list and I will look for your words as I read and learn more. aloha fro Kona Coffee Country. The drink of KIngs!