Q:

How much is my position worth after 5-1 stock split?

How much should my position be after a 5-1 stock split. For ever 5 shares, I get 1 share.
My position before split:
500 shares of ABC with average price of $25.

ABC is trading at $9.  My position is worth $8000 ($12500 - $4500).

After the 5-1 split:
100 shares of ABC with avg price of ??

ABC is trading at $45.

What should my average price be?
I think it comes out to 100 @ $125?

A:

The average price would be $125 which would be used to compute your basis. You paid $12,500 for the stock that is now worth $4,500 which is a loss of $8,000 overall if you sell at this point.

