Should buy motors liquidation company stock

Should buy motors liquidation company stock

Author: suprem_s On: 06.06.2017

Boards Stocks Commodities Forex The Lounge Hot! Traders keep buying old GM stock, despite warnings Traders keep buying old GM stock despite warnings that it soon will be worthless By Tom Krisher and Tim Paradis, AP Business Writers On Thursday August 20,5: Investors are picking up millions of shares every day, thinking they'll profit from what is really a hodgepodge of outdated factories and a pile of debt left behind when the new General Motors Co.

Instead, they could end up losing money very quickly. On Thursday, investors traded The old GM stock had a higher trading volume than big, viable companies like retailer CVS Caremark Corp. Industry analysts and regulators say two groups are buying Motors Liquidation stock: People who are confused and think they are getting shares of the new GM for cheap, and day traders or institutional investors hoping for short-term gains as others continue buying the stock.

GM and federal regulators say they have done all they can to warn investors, giving old GM the appropriate moniker of Motors Liquidation Co. You're buying the detritus," said Harlan Platt, a finance professor at Northeastern University who follows corporate bankruptcies.

Those who invest, experts say, run a very real risk of losing everything at any moment.

MTLLQ:Motors Liquidation Company/ SHOULD I BUY THIS STOCK ? | Yahoo Answers

Aside from the possibility of the stock vanishing once liquidation of the old company ends, demand could wane and prices could plummet to near zero as more people figure out that they're not investing in the new GM.

But for now, there still are traders who haven't gotten the message that Motors Liquidation is merely a shell set up to oversee the sale of GM's bad assets, get as much money for creditors as possible and then be dissolved. Since regulators reinstated Motors Liquidation stock sales on July 15 after a three-day suspension, more than million shares have been traded.

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One investor, in a posting on a Web site for small cap stock traders last week, wondered why the shares, which he bought in June for 47 cents, fell more than 40 cents in one day.

Can anyone give me any reasons or signs why should buy motors liquidation company stock happened? Motors Liquidation was born July 10 when the new GM emerged from 40 days in bankruptcy court free of much of its debt and burdensome contracts.

Douglas Baird, a University of Chicago law professor who specializes in bankruptcy, said it's typical thailand stock market outlook trading of the old company's shares to continue after bad assets have been separated from the good ones in court. The company is still a legal entity and has to have owners.

The shares, he said, may not go away until after the old GM is liquidated and legal claims settled, which could take years. Motors Liquidation has posted a warning on its Web site saying the stock will have no value, but the company cannot halt trading, said spokesman Tim Yost. That's well beyond the purview of any given company.

Securities and Exchange Commission and the Financial Industry Regulatory Authority, which regulates over-the-counter stocks, issued an should buy motors liquidation company stock does dennis rodman make money on July 14 warning against buying or keeping the shares.

Beyond that, SEC officials say they can't prohibit trading in the old stock, only warn against it.

Traders keep buying old GM stock, despite warnings - ABC News

They say there aren't grounds because the bankruptcy is widely known to the public, although FINRA says some stock promoters may have given out confusing and potentially misleading information. So even though the new GM has said it won't offer shares to the public until next year, there are those who still believe they are buying into the new company.

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Ron Humenny, president of Starfire Investment Advisers Inc. A lot of times people will do that, more with their heart than with their head. They can end up falling for an old scam of pumping up a stock on the Internet and then selling it.

Even some well-known public trading sites offer descriptions of Motors Liquidation that could be confusing to investors. Scottrade and Ameritrade, for example, describe it as a company that makes and sells cars and trucks all over the world. The language, spokeswomen for both sites say, came from a third party that they hire to provide content for the sites.

The language also says most of GM's assets were sold to the new company.

should buy motors liquidation company stock

Kim Hillyer, spokeswoman for Ameritrade, said the description is merely a snapshot of Motors Liquidation. She said Ameritrade posted two warnings for its subscribers and added that it's incumbent on investors to check out stocks.

Baird said the SEC isn't likely to step in unless people are misrepresenting Motors Liquidation as the new GM. Tim Paradis reported from New York. AP Business Writer Marcy Gordon in Washington, D.

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