A stock split occurs when a company issues more shares to increase the stock's liquidity.
The most typical split ratios are 2-for-1 and 3-for-1 (also referred to as 2:1 and 3:1).
Accordingly, each stockholder will receive two or three shares, respectively, for each share they had prior to the split.
In year 2023, in total 60 companies announced their stock split.
Prior to the stock split record date, the price typically rises due to increased demand, and following the ex-split date, the price declines in accordance with the split ratio and may drop even further if many investors choose to book profits.
Usually, when a stock split is announced, the price of the stock increases.
Investors might profit from this in an ideal world, but sadly, trading on knowledge of a stock split before it is publicly disclosed is regarded as insider trading.
Unfortunately, a stock split has no effect on an investor's equity.
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