> Michael Gerdts wrote:
> > This would also be an exception to the reverse stock split with a
> > remainder problem. (That is 100 shares become 33 with 1 old
> > share's value of cash.) With mutual funds you can (and usually do)
> > have fractions of shares. With stocks only whole shares are
> > allowed. At least this seems to be the case on exchanges that
> > my stocks are on. Surely there is an exception to this rule
> > somewhere.
>
> Brokers allocate fractional shares to an individual client, especially
> in situations where dividends are automatically reinvested. Ultimately,
> of course, shares are integral; I'm not sure what the broker is really
> up to here - perhaps they are allocating a single share across mutilple
> client accounts, using buffer funds, who knows. But for purposes of a
> client maintaining an account for a particular stock, the end result is
> fractional shares.
Stocks stay "integral," but mutual funds behave almost exactly like stocks,
offering:
- Capital gains
- Capital losses
- Dividends
- Dividend reinvestment
whilst commonly being traded in non-integral numbers. Indeed, I have 15
mutual funds across my portfolio, and not a single one has an integral number
of shares. Several vary _monthly_ by fractional amounts.
--
"No, I'm not interested in developing a powerful brain. All I'm after
is just a mediocre brain, something like the president of American
Telephone and Telegraph Company." -- Alan Turing on the possibilities
of a thinking machine, 1943.
[EMAIL PROTECTED] - <http://www.hex.net/~cbbrowne/lsf.html>
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