Question: 1 to 10 stok merge

[WilliamMGary]

Hmmm....I may have missed something did stock splitting get introduced into the game AND/OR is there documentation on it.

In my game I seen the following message "Trio Unison undergoes a 1-10 stock merge, which groups every 10 shares into one share".

What are the benefits to this etc? Right now I have no idea.

[anjali]

if value of shares drops below a certain value, there will be a reverse stock split to cut the amount of shares and raise value each share, this is like irl when shares go below $5 they usually get reverse splitted (which also can be called stock merge)

lets say a company has 100 million shares at 5$ each and in the next year due to stock price crash the price would fall by 99.99% which would make it like $0.0005 per share not possible really to trade those shares thats why they get reverse splitted and the company would have then 10.000 shares of $5 each = $50.000 market value instead of 100.000.000 shares of $0.0005 each = $50.000

[WilliamMGary]

if value of shares drops below a certain value, there will be a reverse stock split to cut the amount of shares and raise value each share, this is like irl when shares go below $5 they usually get reverse splitted (which also can be called stock merge)

lets say a company has 100 million shares at 5$ each and in the next year due to stock price crash the price would fall by 99.99% which would make it like $0.0005 per share not possible really to trade those shares thats why they get reverse splitted and the company would have then 10.000 shares of $5 each = $50.000 market value instead of 100.000.000 shares of $0.0005 each = $50.000

That makes sense. In the game is this done automatically for the Human Player company as well? From a strategy prospective Is this a good indication that a stock may be undervalued AND/OR about to go backup?

[anjali]

yup done automaticcly for any stock dropping below $1 a share ingame.

doesnt mean the stock have perspective, if it allready lost 90% of value (stocks start at $10 ingame) its mostlikely gonna drop further. all the AI companies that undergo a reverse split are going bancrupt or go into a friendly merger atleast that was the case in any given game i plaid

[WilliamMGary]

yup done automaticcly for any stock dropping below $1 a share ingame.

doesnt mean the stock have perspective, if it allready lost 90% of value (stocks start at $10 ingame) its mostlikely gonna drop further. all the AI companies that undergo a reverse split are going bancrupt or go into a friendly merger atleast that was the case in any given game i plaid

Interesting I'll be sure to inspect them and see if they are a match and/or have some assets I may want. I wish the AI companies would put more firms up for sale prior to going under though. Like if they are in friendly merger discussions or going bankrupt the easiest thing for them to do is put every firm up for sale in an effort to raise capital.