What is meant by stock split?
Jainam Broking Limited
Last Update há 2 anos
A company increases the number of shares that are outstanding by issuing more shares to existing shareholders. For example, in a 2-for-1 stock split, every shareholder holding one share is given an additional share. In such a case, the face value of the share is reduced (say from 10 to 5 per share).
A company's stock price is also affected by a stock split.Following a split, the company's stock price reduces as more shares become issued, but the market capitalization stays the same