A couple weeks ago, I read a quote from some poor soul whining about how a stock he bought is now barely worth what he paid for it, said stock having had a big run-up since he bought it, followed by a decline. Well, the dummy neglected to notice that the stock had split in the interim, and he had made a tidy paper profit.

Unbelievably, I just saw the same mistake in a financial newsletter (for which subscribers pay real money). The doom-sayer publisher was talking about the fact that capital gains (paper profits) can disappear, therefore put your money in bonds and conservative utility stocks. The example of a capital-gains loser that he chose was Cisco, the grinchy crowd's favorite example of what they think is an egregiously overvalued stock. "Those who bought Cisco in February of '99 at 68 saw the stock rise to 81 3/4 a month later. But if they held it, they would just be breaking even (with no return on the investment) because Cisco is now selling at 65." Say what?! CSCO has split twice since early '99. The split-adjusted cost basis per share for a February '99 purchase is under $30. Those who bought would have more than doubled their money, even after the drop. Before you pitch a fit over your lousy investment performance, make sure that you've adjusted your records to reflect splits, dividends, spin-offs, withdrawals, etc.