Stock Splits and Reverse Splits
A 1-minute lesson from the MarketPro academy, one of 18 in stock market basics.
A stock split is a corporate action where a company increases (or decreases) its number of outstanding shares, adjusting the share price proportionally so the overall value of an investor's holding does not change. In a common example, a "2-for-1" split doubles the number of shares an investor holds while cutting the share price roughly in half.
A stock split is a corporate action where a company increases (or decreases) its number of outstanding shares, adjusting the share price proportionally so the overall value of an investor's holding does not change.
Forward Splits
In a common example, a "2-for-1" split doubles the number of shares an investor holds while cutting the share price roughly in half. If an investor hypothetically owned shares worth a total of $1,000 before the split, they would still hold shares worth approximately $1,000 immediately after—spread across twice as many shares at half the price each.
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Lesson 7 of 18 in Stock market basics
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