Question: I was wondering your opinion regarding when selling shares and having the intention of selling all shares in a particular stock, to sell all but one, therefore being included in any future share purchase plans or offers etc?
There are both pros and cons with the above strategy.
The minimum marketable parcel in any one company is currently $500. If you choose to sell a proportion of your shares leaving a value less than $500, the company has the ability to at any time can acquire those shares without your permission.
Maintaining a small holding in a company will also mean that you will receive all communications entitled to shareholders (annual reports etc),this can add to the mail already received and may be a cause of frustration for some. This has become less of an issue with most registries switching to electronic communication methods.
The benefits of such a strategy are that as a shareholder you will be entitled to receiving offers for corporate actions that can prove beneficial to shareholders, however it is important to note that some companies may scale down entitlements for smaller share parcels.
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The views expressed in this article are those of Stephen Karpin, a representative of Commonwealth Securities Limited (CommSec) ABN 60 067 254 399 AFSL 238814. CommSec ABN 60 067 254 399 AFSL 238814 is a wholly owned but non-guaranteed subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 23495 and a Participant of the ASX Group.
This article was produced by CommSec. Except to the extent that any liability under any law cannot be excluded, no liability for any loss or damage which may be suffered by any person, directly or indirectly, through relying upon any information or statement in this document is accepted by the Commonwealth Bank or CommSec or any of their directors, employees or agents, whether that loss or damage is caused by any fault or negligence on their part or otherwise. Commonwealth Bank and its subsidiaries do not guarantee the obligations or performance of CommSec or the products or services offered.
As this information has been prepared without considering your objectives, financial situation or needs, you should, before acting on this information, consider its appropriateness to your circumstances and if necessary, seek appropriate professional financial and taxation advice. The article does not representation a recommendation on any particular company.