Oct 15, 2016
Financial Security
Looks like my shares of Goodrich Petroleum are literally worthless. The company had recently went into bankruptcy with about 90% of their debt eliminated (wish I could do that with my debt). I had bought their shares for a penny each, thinking I would be in good position to hold stock once the company emerges from restructuring. However, I did not read the bankruptcy agreement, especially important was the part where the company would cancel out all previous shares. Thus when the company emerged from bankruptcy, shares went from a penny a piece to zero a piece. In the future, I will not invest in bankrupt companies without looking more carefully what the condition for restructuring are. Fortunately my second purchase did not go through, so instead of losing $4 I am out $2. Looks like that will have to be a tax deduction.
Doesn't sound like you have to lose any sleep over this one. Anyway, you are learning as you go. I wish I had the mental energy to analyze stocks. The treasurydirect.gov website is confusing enough for me. I have no employment income or I sure would be contributing $500 a month to a Roth.
ReplyDeleteFor $2 its a cheap lesson. I am currently contributing to a Roth and 401k, but I wanted to see if I can retire before I hit age 60.
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