Quote:
Originally Posted by adbynot
There is no difference in that they both total $100, the problem might be that the $100 share might have a harder time making a better % compared to the $10 share. I know they both have to rise by the same percentage but I think the $10 share has more room to climb then say the $100.
This is not true.
What company can grow better:
The company having 100 million shares outstanding worth $10 a piece
or
The company having 10 million shares outstanding $100 a piece.
Another exercise: Berkshire Hathaway (Buffett's company) has a B class worth about $3,3k a share right now. Next year they're going to do a stocksplit taking every B share and multiplying it by 50. The price will also be divided by 50 because there will be 50 times more shares outstanding. So next year you own 50 B shares worth $66 a piece. Does the company have more room to grow now?