http://seaofopportunity.blogspot.com/2011/05/citis-reverse-split.html interesting ... it was a great trade and will be missed by many
Iin general, if earnings and balance sheet don't improve, reverse split is another shorting opportunity.
LOL. I wouldn't mind be paid big bucks for sharing worthless opinions Generally, reverse splits are done to avoid delisting or to make their shares look more valuable in order to attract institutional buyers who are prohibited from buying low priced stocks (I think <$5). Stocks below $5 trade at that price for a reason. They're usually in distress and a reverse split does nothing to change that. Sure there are exceptions but statistically, such companies tend to underperform the market short and long term (until they improve their financials). So yeh, it may be another good shorting opportunity, particularly if we get another period of financial stock distress. If this debt ceiling fear/hype comes to fruition, Citi will be high on my list to hit hard.
Read the last paragraph of my last response. From that, can you figure out when shorting Citi would be appealing to me?