

Who cares what Apple's stock price is? - mathattack
http://www.bloombergview.com/articles/2014-04-25/who-cares-what-apple-s-stock-price-is

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Fomite
"If you can afford to invest $80 in Apple stock, but you cannot afford to
invest $565 in Apple stock, you should not be investing $80 in Apple stock. I
can point you to some very nice index funds, or just, like, I mean, open a
checking account."

Back when I was a kid, learning about financial literacy, the stock market,
etc. my parents encouraged me to buy shares in a company I liked, whose
products I used, etc. It wasn't a shrewd investment strategy, or a balanced
portfolio (those would come later), but an introduction to the market,
brokerages, etc.

I put in as much as I could, being, you know, 12 or so. It was less than $565.

Post-split, my cost basis on those shares will be a hair under a dollar. I've
very glad, at the time, that a share of Apple stock was accessible to people
like me.

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JamilD
I think that statement was more targeted at people who would be at financial
risk if that money were lost. Presumably even if you, as a kid, lost that
money in the market, you'd still have the support of your parents.

However, for a low-income family with barely any money, it would be unwise to
put your only savings in a single company instead of something more
diversified like an index or mutual fund.

~~~
Fomite
I agree, as a general statement, and as a principle of investing. I just find
the "accessibility doesn't matter" argument...irksome.

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robotresearcher
"If you can afford to invest $80 in Apple stock, but you cannot afford to
invest $565 in Apple stock, you should not be investing $80 in Apple stock. I
can point you to some very nice index funds, or just, like, I mean, open a
checking account."

Index funds and checking accounts have not given nearly as much return as
Apple over the last several years. Why shouldn't people who can afford to risk
$100 but not $500 have access to these returns?

~~~
mathattack
I think his point is that if one share costs too much, you generally shouldn't
be so all-in to one stock.

By and large, the people with $100 to spend aren't beating the index on
average. Transaction costs eat up too much of it. Yes there are outliers, but
companies don't split to enable low income buyers the opportunity to buy
single shares.

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smackfu
I still am not clear on why this is a problem Apple should spend money to
solve. (Since a stock split is certainly not free of administrative costs.)

~~~
aet
The stock split has the potential to reduce trading costs (stuff to do with
tick size, and odd lots) etc...

[http://www.kelley.iu.edu/cholden/Stock%20Splits%202006-05-03...](http://www.kelley.iu.edu/cholden/Stock%20Splits%202006-05-03.pdf)

~~~
smackfu
Right, but what is the benefit to Apple of reducing those costs? Maybe they
save money when they are doing stock buybacks?

~~~
aet
The stock become more attractive to hold

