Stock Split

Market Mechanics

A stock split divides each existing share into several shares.

The share count rises and the per-share price falls by the same ratio; the company's market value and the total value of your holding do not change. Charts and historical earnings per share are adjusted backward for the split.

Example

01Before the Split10 shares × $400
024-for-1 SplitEach share becomes four
03After the Split40 shares × $100

$4,000

Total Value, Before and After

In a 4-for-1 split, 10 shares at $400 become 40 shares at $100; the total is still $4,000.

Related Terms

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