bank is offering me stocks?

Question

so my local bank is offering me some stocks at $20 a pop, while the stocks are worth over $40, should I take the bait? I can afford to do it, but if I do, would be a good Idea just to keep them for a while. I've been a customer for over ten years, what's your take on this? thanks and let me know if I'm making any sense so I elaborate more

it's converting from a mutual holding structure to a stock holding structure from what the prospectus is saying

Answer 1

If you're being told the stock is worth 2X it's value... remember that's just an opinion.

Make this investing decision as you would any other. Is there real value? How does this bank stand in it's market place? What are it's problems (sub prime loans, etc)?

How does this fit with your "asset allocation"?

BTW: Asking complete strangers, with no way to check their qualifications........ is not a good way to find a solution to your problem.

Answer 2

Which bank? Which stocks? Are you saying they will offer you a $40 per share priced stock for the price of $20 per share? or a $40 per share priced stock for $40 per share plus their commission of $20? I can't see them offering 1000 shares of a $40 stock for $20 and losing $20,000. If their commission is $20, and it is a convienent place for you to trade, that price is fine. There are online discount brokers that charge less ($3.95 is the lowest I have seen), but at the end of 20 years of holding, a $16.05 difference on 1000 shares of stock is not a hill of beans.

Answer 3

BUY as much as you can especially if it's worth twice the amount.
Are they going public (IPO) soon?
If they are just buy and hold on to them.
Sell half to get you investment back if you need the money.
Let the other half grow.
Banks and insurance companies are very safe investments over the long run.
I won't sell unless it's pretty high because they might get taken over my a large firm.

LUCKY YOU

Answer 4

that's fine... But choose the right one


http://www.sharesandmutualfunds.110mb.com/