how to make money in stocks and how to get rich_17

Corporate management at times makes the mistake of excessively splitting

its company's stock. This is sometimes done based upon questionable

advice from the company's Wal Stret investment bankers.

In rny opinion, it is usually better for a company to split its shares 2-'

for-

1 or 3-2, rather than l 5-l. (When a stock splits 2-1, you getwo shares

for each one previously held, buthe new sell for half the price.)

Overabundant stock splits create a substantially larger supply and may

put a company in the more lethargic performance, or "big cap," status

sooner.

It is particularly folish for a company whose stock has gone up in

price for a year or two to have an extravagant stock split near thend of

a

bull market or in the early stage of a bear market. Yet this is exactly

what most corporations do.

They think the stock wil atract more buyers if it sels for a cheaper

price per share. This may occur, but may have the opposite result the